Industries under BPIS to be restructured
JAKARTA (JP): State Minister of Research and Technology B.J. Habibie said yesterday that state-owned enterprises overseen by the Management Board for Strategic Industries (BPIS) will be restructured financially.
"The restructuring will determine, for example, the levels of government equity participation and the state funds which should be considered as debts on the part of the enterprises," he told reporters here during a break in a hearing with the House of Representatives' Commission X, which oversees science, technology and environmental affairs.
Habibie refused to go into details, saying that the results of studies on the financial restructuring had not yet been completed.
Earlier this year, Habibie, who is also chairman of the Board for the Technology Assessment and Application, admitted that five of the ten state-owned enterprises under the BPIS supervision suffered financial losses.
Among the enterprises are PT IPTN aircraft manufacturer and PT PAL shipyard.
According to economists, the losses were caused by inefficiency in the companies, which in turn resulted in low returns on investment.
Habibie, who is also chairman of BPIS, blamed the inefficiency of the strategic industrial companies on the lack of export- credit facilities to support the marketing of their products.
Funding
Minister of Finance Mar'ie Muhammad said in March that the government was studying the possibility of providing credit for the export of strategic industry products, including aircraft.
Mar'ie's statement came after he had earlier rejected such an idea, saying that the provision of such a credit facility was virtually impossible, given the government's tight budgetary constraints.
Habibie insisted yesterday that in order to improve the country's high-technology industries managed by BPIS, their development needed to be initially funded by the government.
"We need to develop human resources, facilities and skills. I am sure that one day, when IPTN has developed and no longer depends on certain products, we will be selling shares to the public," he said, adding that the government may end up owning only 40 percent of the company.
Investment
"We must see the industries as an investment. As long as we develop them professionally, there is no need to worry that they are merely wasting money," he said.
Efforts to expand the market for IPTN aircraft include a deal made with the German state of Niedersachsen (Lower Saxony) and the town of Mobile in Alabama, the United States, both of which were selected earlier this year as the sites for assembly plants for IPTN's aircraft.
Niedersachsen is intended, similarly, to be the marketing center for IPTN's N-250 70-seater plane, priced at about $13.5 million, in Europe.
Earlier this year, President Soeharto ordered the Ministry of Forestry to transfer Rp 400 billion ($180 million) of its reforestation funds towards financing IPTN's projects.
Responding to questions about the sale of IPTN military aircraft to Australia, Habibie said that, under the "Phoenix program", Indonesia hopes to sell 18 CN 235-330's and their spare parts for a total of $650 million.
He named Italy and Spain as the toughest competitors in the bid.
Habibie said that if Australia agrees to buy IPTN's aircraft, the payment will be made in cash, which is normal procedure in the purchase of military equipment.(pwn)