BKPM to help sell assets under IBRA

BKPM to help sell assets under IBRA

The Jakarta Post, Jakarta

The Investment Coordinating Board (BKPM) signed on Friday a
Memorandum of Understanding (MoU) with the office of the State
Minister of State Enterprises to help in the marketing of assets
held by the Indonesian Bank Restructuring Agency (IBRA).

The MoU was signed by BKPM Chairman Theo F. Toemion and State
Minister of State Enterprises Laksamana Sukardi.

The latter office oversees IBRA, which holds around Rp 600
trillion (about US$60 billion) worth of assets transferred from
ailing banks and indebted bank owners in the wake of the 1997
financial crisis.

IBRA is mandated to restructure and sell the assets to raise
cash to help finance the state budget, which has been heavily
burdened by the huge cost of bailing out troubled banks by the
government. The disposal of the IBRA assets is also crucial to
help accelerate the country's economic recovery.

The agency has been criticized for slow progress in selling
the assets.

This year, IBRA has set a target to raise around Rp 4.2
trillion in cash from the asset sale program to help finance the
2002 state budget deficit estimated to be 2.5 percent of gross
domestic product.

"BKPM will help in the sale of IBRA assets to lure
investments, particularly from foreign investors, which so far
has been discouraging," Theo told reporters after the MoU signing
ceremony.

"With our capacity in BKPM, we can create a synergy with the
state enterprises ministry to help market state assets or
projects to investors," he added.

BKPM said earlier that foreign direct investment (FDI) in the
first two months of this year fell by 79 percent to $489 million
from $2.33 billion in the same period last year.

For 2001, FDI approvals reached $9 billion, lower than $15.42
billion in 2000.

According to the MoU document, the cooperation deal in the
sale of the IBRA assets would allow BKPM to be directly involved
right from the start with the planning, developing and promoting
of assets or projects to be sold to investors.

Identifying assets and projects to be sold and their potential
for investors, would also be part of the BKPM task, followed by
gathering of and packaging of information on the assets.

After that, the dissemination of information on the assets and
projects to investors will be undertaken through the media and at
seminars among other forms.