New chief economy minister to directly rule state firms

JAKARTA (JP): Coordinating Minister for the Economy Rizal Ramli said on Tuesday his office would be directly in charge of the country's 155 state enterprises.

He said the government had decided to establish a special body under his office which would oversee the development of state concerns.

"This way, we can expect a faster and more effective privatization process of state companies," he said after a media meeting.

The development of state enterprises was previously held by the state ministry of investment and state enterprises development.

The government dissolved the state ministry as a result of President Abdurrahman Wahid's streamlining of his Cabinet. He said members of the body would comprise all ministers who had state enterprises operating in their respective fields.

These would include, among others, Minister of Trade and Industry Luhut Pandjaitan; Minister of Energy and Mineral Resources Purnomo Yusgiantoro; Minister of Finance Prijadi Praptosuhardjo; Minister of Transportation and Telecommunications Agum Gumelar; and Minister of Agriculture and Forestry Bungaran Saragih.

Rizal said he would ask the office of the former state ministry to submit a review of the current progress in the privatization of state enterprises.

The government expects to raise some Rp 6.5 trillion (US$790 million) from the privatization of 10 state firms during the April-December 2000 fiscal year.

Nevertheless, thus far none of the targeted state firms have been privatized, as the government says it is waiting for the right market sentiment.

Separately, Riza Primadi, deputy at the now defunct state ministry of investment and state enterprises development, said he had just heard of the plan to place the state enterprises under Rizal's office.

"We'll likely hear more about it tomorrow; the government has a way of letting the public know before they tell us," he told The Jakarta Post.

Riza described the move as a compromise on whether state firms should be controlled by an independent ministry, like his office once did, or by related ministries.

"But what is important is that the operator and regulator should not fall into one man's hands," he explained.

Riza said the government might mix its role as a regulator of the economy with its responsibility for developing state firms.

"This would create an unequal playing field between state- owned companies and private companies," he explained.

Furthermore, he said, the different ministries on the board might cause problems when they interfered with the current privatization process.

"It's better to have one commando who understands the entire privatization process," he said.

He suggested that the special body study the existing privatization master plan, which contains all the information required to complete this year's privatization targets.

The chief minister did not explain the fate of the government agency which handles foreign investments, which was previously put under the office of the state minister for investments and state enterprises development. (bkm)