Minister to revamp state firms
Minister to revamp state firms
JAKARTA (JP): Minister of Industry and Trade Tunky Ariwibowo
said here yesterday that the government would restructure state-
owned companies in a move to boost their efficiency.
Tunky said the restructuring plan would cover both improvement
of the management and the consolidation of business activities.
"Money losing firms, which have no future, would be
liquidated. Those with good prospects would be expanded," he told
newsmen following a meeting with President Soeharto at the
latter's Jl. Cendana residence here.
Tunky said that state-owned companies which have similar
business lines would be consolidated under a restructuring plan
which was proposed by Minister of Finance Mar'ie Muhammad.
"We don't have a fixed schedule. But we have been asked by the
minister of finance to immediately carry out the plan," said
Tunky, who was accompanied by Mar'ie during the meeting with the
President.
The minister of finance, which represents the government in
the ownership of state-owned firms, did not make any comment
about the restructuring plan.
"The consolidation of fertilizer producers, for example, will
be part of the restructuring plan in the Ministry of Industry and
Trade," Tunky said.
He said the number of state-owned companies operating in
industrial and trading activities totaled 62 as of December,
1995. The number of money losing firms rose to nine last year
from eight in 1994.
Revenues
Tunky said that the total sales revenues of the state-owned
industrial and trade-related companies rose to Rp 9.56 trillion
(US$4.1 billion) in 1995 from Rp 7.79 trillion in 1994, with
before tax profits rising to Rp 1.06 trillion from Rp 633.63
billion.
The amount of losses incurred by state-owned firms rose to Rp
108.33 billion last year from Rp 82.74 billion in 1994, he said.
The minister also reported to the President about efforts to
cope with the shortage of urea fertilizer supplies, which hit
farmers in almost all paddy producing areas in Java and Sumatra
in December and January.
At a press briefing held following the meeting with the
President, Tunky blamed the distribution system for the shortage
of urea supplies.
Tunky ruled out any increase in exports as the cause of the
supply shortage, given the fact that none of the fertilizer
producers were licensed to export urea during the last two
months.
He said that the amount of the monthly supplies would be
increased so that there would be more stocks to meet an increase
in the demand from farmers.
The urea supply was projected at 6.14 million tons this year,
while demand might reach only four million tons, the minister
said.
Tunky also said yesterday that the government was targeting an
increase in the cement supply to 28.5 million tons this year from
24.3 million tons to meet higher demand.
Around 26.5 million tons of the supply would be procured from
domestic producers, while the other two million tons would be
imported, he said.
The domestic demand for cement was expected to increase by 16
percent to 27.5 million tons this year from 24.1 million tons in
1994. (hen)