Observer: Reinvesting SOE Profits Could Boost Economic Growth

Jakarta (ANTARA) - State-owned enterprise (SOE) observer and Director of NEXT Indonesia Center Herry Gunawan believes that the policy of reinvesting SOE profits by the Danantara Investment Management Agency has the potential to drive national economic growth.

According to Herry, reinvesting SOE profits can strengthen the gross fixed capital formation (PMTB) component, which is one of the important components of economic growth.

“In addition, the opportunity for labour absorption will also be greater,” said Herry when contacted by ANTARA in Jakarta on Friday.

He believes the policy needs to be monitored so that investments derived from SOE profits truly have an impact on the economy.

Besides driving economic growth and labour absorption, Herry said that investing SOE profits in the downstreaming sector also has the potential to increase foreign exchange earnings.

According to him, the downstreaming process makes the products produced have a higher selling value compared to commodities sold in raw form.

In his state address at the 2026 Annual Session of the MPR RI and the Joint Session of the DPR-DPD RI at the MPR/DPR RI Building in Jakarta on Friday, President Prabowo Subianto said that the government, together with Danantara, is directing SOE profits to accelerate downstreaming.

The President said that SOE profits in 2025 increased to Rp326 trillion, or grew by 75.3 percent, while dividends paid reached Rp142.3 trillion, an increase of 67 percent.

The government has also carried out groundbreaking for 26 downstreaming projects with Danantara throughout 2026.

In addition to downstreaming, the government is also promoting an upstreaming strategy by utilising SOE profits to acquire the world’s best companies.

This step is aimed at obtaining technology, management, and market access that can strengthen Indonesia’s position in the global supply chain.