Government restructures state firms
Government restructures state firms
JAKARTA (JP): The government has started restructuring state-
owned companies to improve their performance and competitiveness,
Minister of Finance Mar'ie Muhammad said yesterday.
"There are too many state-owned enterprises that need to be
restructured...in order to reach an ideal economic scale," Mar'ie
told a hearing with the Budgetary Commission of the House of
Representatives.
Indonesia currently has over 200 state-owned enterprises, with
combined assets of over Rp 350 trillion (US$150.5 billion).
"I'm not happy with the current performance of most state-
owned companies," Mar'ie told the commission.
Under the restructuring program, Mar'ie said, state-owned
companies in the same sector would be merged or united under one
holding company.
To kick off this program, the government on Monday
restructured 16 state plantation companies, known as PT
Perkebunan (PTP), by merging them into 14 entities to boost their
efficiency.
The 14 plantation firms, renamed as PTP Nusantara I - XIV,
were established with a paid-up capital of between Rp 300 billion
and Rp 1.7 trillion each.
Minister of Agriculture Sjarifudin Baharsjah told journalists
after the signing of the notary deeds for the 14 plantation
entities that the restructuring was conceived to facilitate their
future listing on stock exchanges.
"I hope that within the next two years, one or two of the 14
PTP Nusantaras will go public," Sjarifudin was quoted by Antara
as saying.
The government is currently preparing a number of state-owned
companies for privatization, including tollroad operator PT Jasa
Marga, PT Krakatau Steel, electricity firm PT Perusahaan Listrik
Negara, general mining firm PT Aneka Tambang and Bank Negara
Indonesia 1946.
The government has so far privatized four state firms, PT
Semen Gresik, telecommunication firms PT Indosat and PT Telkom as
well as tin-mining firm PT Tambang Timah. The last three listed
their shares on foreign stock exchanges as well as local ones.
Deregulation
Mar'ie said the government would soon deregulate state
enterprises to make them compete with private firms.
"It is hoped that state firms will be able to conduct business
more freely while remaining under control," Mar'ie said. "We used
to have a state firm out of control -- oil company Pertamina."
He noted that the planned deregulation will cut bureaucracy at
state-run companies. They will no longer be required to follow
current procedures, which involve a number of related ministries.
At yesterday's hearing, the minister and the commission
continued their deliberations on the amendment of the
government's budget for the current fiscal year. The discussions
on the amendment will end today.
Yesterday Mar'ie also disclosed that the government is
currently working on new policies on investment and also on
measures to curb imports.
He said the new policies on investment will treat domestic and
foreign investments in essentially the same way.
"In this era of globalization, there are no distinct
differences between foreign and domestic companies. The most
important thing is how much they contribute to the country's
economy," Mar'ie said.
Currently foreign investment in Indonesia is regulated under
the 1967 foreign investment law, while domestic investment is
regulated by the 1968 domestic investment law.
Speaking on measures to curb imports, Mar'ie said that the
government is sounding out ways, in addition to Presidential
Decree No. 19/1996, to promote the use of domestic products.
The decree recently established a special import monitoring
team to make sure that the projects of the government and state-
owned companies use as many local products as possible.
"I am now still working on the additional measures with the
minister of trade and industry," Mar'ie said. (rid)