Conglomerates 'may not control economy'

JAKARTA (JP): President Soeharto insisted yesterday conglomerates would not be allowed to control the national economy and called for more emphasis on the development of small businesses and cooperatives.

"In fact, we don't want the national economy to be controlled only by conglomerates. We also don't want a national economy which benefits only conglomerates," Soeharto said.

The President said the national economic system should emphasize partnerships. Thus, small businesses and cooperatives should be given opportunities and assistance to develop.

Soeharto said conglomerates could not stand alone and were also dependent on small businesses and cooperatives.

But the President said the government would still support conglomerates despite giving more attention to small companies and cooperatives.

Their presence is needed to enable Indonesia to compete in the global economy, he said.

"What we have to do is give a little economic support, facilities and chances to improve their role in the national economy," Soeharto said at a ceremony inaugurating the Management Development Center of PT Astra International, Indonesia's largest car maker.

Present at the ceremony were Astra's president commissioner, Muhamad "Bob" Hasan and State Secretary Moerdiono and the minister of cooperatives and small enterprises, Subiakto Tjakrawerdaya.

Nusamba, a business group owned by three foundations chaired by Soeharto, bought about 8 percent of the publicly listed Astra last year.

Only recently the group, headed by Bob Hasan, also bought 49 percent of PT Indocopper Investama Corporation, which owns 9.6 percent of Freeport Indonesia.

The group, through its subsidiaries, also has a 30 percent stake in the huge Busang gold mine in East Kalimantan.

Soeharto said the responsibility of helping small businesses and cooperatives did not only lie only with the government but also with conglomerates.

He said the government and conglomerates had taken some measures to help small businesses and cooperatives.

The government has asked banks to give more credit to small businesses and cooperatives. He said about a fifth of bank loans went to small companies.

State-owned companies and conglomerates had also earmarked some of their profit to alleviate poverty.

But small businesses and cooperatives still had human resource and management problems, he said.

To help solve this problem the government will establish business consultancy clinics run by jobless university graduates, to train small businesses and cooperatives. The clinics will initially be set up across Java.

The President called on conglomerates to take the government's effort to bridge the gap between the rich and the poor seriously.

"Honestly speaking, as long as the gap exists, the issue will be used by people who don't like Indonesia progressing. They will use it as a political issue to excite people," he said.

"Finally, if those who listen to them can't control themselves and ruin everything. It's us who suffers the loss," he said.

Soeharto praised Astra for assisting small businesses and cooperatives in 16 countries. Other conglomerates could imitate Astra's efforts, he said.

Bob Hasan said the company had given managerial, technical and marketing assistance to 66,274 small businesses and cooperatives. (jsk)