Govt supports 'status quo' on Semen padang case
Govt supports 'status quo' on Semen padang case
The Jakarta Post, Jakarta
The government would maintain the "status quo" in the high
profile PT Semen Padang case, Minister of Home Affairs Hari
Sabarno said on Thursday.
"For the time being, the status quo will be maintained in the
(Semen Padang) case, meaning it (the company) will not be spun
off nor will the put option be exercised," Hari told reporters
after attending a state function in Merdeka Palace.
He also ordered the West Sumatra administration to make sure
that protesting local people did not take over the Semen Padang
plant.
"The important thing is that the plant can still operate and
provide benefit to the local government and people," Hari said.
He did not provide details on the status quo policy, but the
Office of the State Minister for State Enterprises has set a Dec.
14 deadline for the sale of a 51 percent stake in state-owned
cement producer PT Semen Gresik, the parent of Semen Padang, to
Mexican cement giant Cemex SA de CV via a put option deal. Cemex
already owns 25 percent of Semen Gresik.
The initial deadline was Oct. 26, but it was put back due to
protests from West Sumatra people demanding that Semen Padang be
spun off from Semen Gresik before the government exercised the
put option.
The protests against foreign ownership of Semen Padang
culminated last week when the local administration issued a
decree taking over the plant. This was approved by the local
provincial council.
The move further jeopardized the country's already floundering
privatization prospects and prompted a warning from the World
Bank on Monday that other provinces could replicate the takeover
attempt.
The World Bank's chief economist in Jakarta, Vikram Nehru, has
urged Jakarta to overrule the takeover attempt and immediately
press ahead with the sale, or risk creating "tremendous investor
wariness and uncertainty" toward future sell-off attempts.
The West Sumatra administration, however, backed down from the
takeover move earlier this week following strong criticism from
various quarters.
Local leaders in South Sulawesi, the home of another Semen
Gresik affiliate, PT Semen Tonasa, have been pressing the
administration there to follow suit, also demanding Tonasa's
spin-off from Semen Gresik.
Meanwhile, a senior government official said Thursday that
State Minister for State Enterprises Laksamana Sukardi was
scheduled to fly to Padang to seek an amicable resolution to the
case.
Semen Padang president Ikhdan Nizar told The Jakarta Post on
Thursday that reports of the takeover of the plant had not
affected production.
He said that activities within the company were continuing as
normal and that production per day had reached 18,700 tons.
"There's no problem, employees are working as usual," he said.
Semen Padang and Semen Tonasa contributed half of Semen
Gresik's 2000 sales of around 13.8 million tons.