Rp 2.8 trillion spent to help small business

JAKARTA (JP): State Minister of Cooperatives and Small-scale Enterprises Subiakto Tjakrawerdaya said yesterday that state companies and the Jimbaran-club tycoons had spent Rp 2.8 trillion (US1.1 billion) helping cooperatives and small business over the last six years.

The state companies had provided Rp 687 billion between 1990 and November this year in low-interest loans. And the Jimbaran group had spent about Rp 2.1 trillion this year on business partnership programs.

The Jimbaran club is the name of a group of 48 tycoons who pledged at a meeting early last year in Jimbaran, Bali, to help the government eradicate poverty.

The group began helping cooperatives and small business this year.

State companies have been involved in the government's program since 1990. They are required to set aside up to 5 percent of their after-tax profits to help cooperatives and small business.

Early this year, the Jimbaran group committed to spending Rp 2.9 trillion on cooperatives and small business through low- interest loans or business partnerships.

Some of the group's members had not fulfilled their promise, the minister said. He refused to name them.

"We shall hold a special meeting with those who are yet to fulfill their promise, urging them to realize them soon," he told an end-of-year press conference.

Subiakto said some Jimbaran members were still studying the best ways to channel funds to cooperatives and small business. Many of them had set up special divisions to handle the funds.

He said state companies had allocated about 930 billion in their budgets since 1990, but only Rp 687 billion had been distributed.

They had allocated Rp 188 billion this year but only Rp 102 billion had been channeled, he said.

As part of the government's program to cut disparity between large and small companies, President Soeharto called on big businesses in 1990 to sell their shares to cooperatives and small business. Subiakto said only 110 of the 248 publicly listed companies had done this, while 201 unlisted companies had followed his appeal.

The President urged companies to sell their shares to cooperatives at nominal prices or around 10 percent of their market value.

"We still encourage them to sell their shares as urged by the President," he said.

The program to help cooperatives and small business was fruitful: 3,573 small businesses had grown to become medium-scale businesses this year, above our target of 3,400, he said. "Another 3,948 small businesses had become independent (from the program), below our target of 7,540," he said.

The government expected to help 15,000 small businesses become medium-scale businesses and another 20,000 small businesses become independent at the end of this Five Year Development Plan in 1999, he said.

Subiakto said cooperatives had done increasingly well throughout the year.

There are now 48,335 cooperatives, up from 46,456 last year, with 26.9 million members, up from 26.3 million last year. Cooperatives' assets are worth Rp 5.9 trillion, up from Rp 5.7 trillion at the end of last year.

The minister said President Soeharto would name 1997 as the Year of Cooperatives to coincide with the golden anniversary of Indonesian cooperatives.

The President would also name 1997 as the Year of Telecommunications. (jsk)