Govt requires SOEs to pay more dividends

Govt requires SOEs to pay more dividends

Rendi A. Witular, The Jakarta Post, Jakarta

The government has requested 10 of the largest, healthy state-
owned enterprises (SOEs) to increase their allocation for
dividend payments and to pay interim dividends to meet the state
revenue target from SOEs this year, a minister said.

State Minister of State Enterprises Sugiharto said revenue
from SOEs would be Rp 500 billion (US$55.5 million) short of the
target this year unless SOEs, especially the big 10, managed to
boost their net profit and pay interim dividends.

"As of October, revenue from SOEs has reached Rp 8.6 trillion,
which is still below this year's target of Rp 9.1 trillion," said
Sugiharto on Monday.

Based on this year's state budget, Rp 2.16 trillion of the
dividend revenue target will be contributed by state oil and gas
firm PT Pertamina, with the remaining Rp 6.93 trillion from other
SOEs, such as telecommunications firm PT Telkom, Bank Mandiri,
Bank BNI, Bank Rakyat Indonesia, state gas utility firm PT
Perusahaan Gas Negara, pharmaceutical firm PT Kimia Farma, and
mining firms PT Aneka Tambang (Antam), PT Batubara Bukit Asam,
and PT Timah.

These companies are considered top performers and are listed
on the Jakarta Stock Exchange.

Revenue from SOEs, along with their taxes, is needed to help
plug the state budget deficit particularly as proceeds from the
privatization program is unlikely to be sufficient.

The state budget deficit is estimated to reach Rp 24.41
trillion, with several lawmakers having estimated that the
deficit has now expanded to more than Rp 30 trillion due to the
rise in the fuel subsidy following a jump in global oil prices.

Sugiharto also said that there was a possibility that the
government would sell some of its stake in a number of SOEs via
the stock market this year to help finance the state budget, amid
flourishing trading activities in the local bourse.

"I have never said that the privatization program will be
closed for this year. We still have one month and a week, and
anything is still possible," he said.

Sugiharto explained that state-owned companies that could
possibly be privatized in the near future would be those that
have already received approval from the House of Representatives
or those that were about to be given the green light.

Among the possible assets that will be sold this year through
private placement in the stock market are government shares in
Bank BNI, Bank Mandiri, and in several mining firms, such as in
Antam and Timah.

"The privatization of BNI will depend on the appraisal of the
country's banking sector that we are currently still working on.
We expect the study to be completed in the next 30 days, or in
the third week of December," said Sugiharto.