Minister rules out more equity in hotel firm

JAKARTA (JP): The government yesterday ruled out giving more equity to the state-owned hotel firm PT Hotel Indonesia International Corporation & Natour, which is attempting to improve its financial structure.

"The era of government-equity support in state-owned enterprises has ended," Minister of Tourism, Post and Telecommunications Joop Ave said.

The minister's statement indicated that Hotel Indonesia International Corporation & Natour, which is responsible for Rp 90 billion (US$38.3 million) in loans, should look for other solutions to regain its financial stability.

On Tuesday members of the House of Representatives committed themselves to supporting the firm campaign for more government equity investment to improve its financial structure.

"I'm touched that House members have been very keen to support the firm. But my opinion is no," Joop said.

Hotel Indonesia International Corporation & Natour, currently running 17 aging hotels, suffers from long-term financial problems and is likely to lose at least Rp 27.5 billion this year after losing about Rp 20 billion in 1995.

The company's president, Indra Setiawan, said Tuesday that more equity from the government would be one of the best ways to restore the company's financial structure.

He said that another solution was to forge partnerships with private firms in developing several hotel and property projects on sites owned by his company in Jakarta and other cities.

Since Joop had closed the possibility for more equity from the government in Hotel Indonesia International Corporation & Natour, the company would now focus on the partnership plans, Indra added. (icn)