Habibie supports asset distribution plan: Adi

JAKARTA (JP): Minister of Cooperatives and Small Enterprises Adi Sasono said on Tuesday that President B.J. Habibie fully supported the proposal to distribute the assets of conglomerates and banks taken over by the government among small and medium- sized enterprises (SMEs) and cooperatives.

"It's a policy which has been mentioned several times by Habibie," he told reporters after addressing a seminar on the redistribution of assets.

The minister said that assets would be distributed in a bid to bridge the gap between the rich and poor which resulted from decades of unfair governance.

He did not elaborate on how he planned to redistribute the assets, but stressed that it should be done in accordance with the existing law.

"This isn't some reckless, personal agenda to acquire other people's assets unlawfully," he said.

He said the distribution would be conducted in accordance with the terms of the new anti-monopoly bill which is currently being deliberated by the House of Representatives (DPR).

The government put 24 banks under the supervision of the Indonesian Banking Restructuring Agency (IBRA) after the banks failed to repay massive liquidity loans provided by Bank Indonesia. The shareholders of some of the banks have been forced to surrender assets after failing to repay the loans.

Earlier this month, IBRA began to auction off non-core assets confiscated from banks closed by the government in April and August.

Adi said that asset distribution would bring a greater balance to the distribution of wealth in the country.

Small-scale enterprises make up 99 percent of the 40 million businesses registered in the country, but only control 12 percent of the total national assets, he said, adding that the remaining 88 percent of assets were controlled by a handful of large conglomerates.

"Narrowing the gap between small businesses and conglomerates will surely improve the current political situation because it will reduce unemployment, create job opportunities and reduce poverty," he said.

However, economist Pande Radja Silalahi warned that the proposal to distribute assets was dangerous and said that a policy of charity would not resolve the country's economic problems.

"The policy is not based on the right principle. The minister is not Robin Hood. The people will not be able to live off charity alone," Pande said.

He said the government should instead focus on developing the human resources in small and medium-sized ventures because a lack of the necessary managerial skills presented them with bigger problems than a lack of capital.

Economist Umar Juoro said he supported the proposal to redistribute assets, arguing that it was "politically acceptable and economically sound".

IBRA Chairman Glenn S. Yusuf said last week that he had not been informed of any plan to sell the assets of banks under IBRA's care to cooperatives or small and medium-sized businesses.

"I've yet to see any statement from our minister saying that. However, it's a noble idea to allow more Indonesians to enjoy the fruits of growth in the country," he said.

The assets of banks under the agency's supervision are now worth more than Rp 100 trillion, Glenn said.

During the rule of former president Soeharto, vast wealth became concentrated in the hands of his closest friends and family.

Soeharto initiated an abortive program designed to bring large business groups into working agreements with cooperatives.

Under the program, cooperatives were given stakes in major companies which they then paid for using dividends from the shares. (das)