State firms should lead economic recovery: Minister
State firms should lead economic recovery: Minister
YOGYAKARTA (JP): The 164 state firms should become the
powerhouse to propel the country through its worst economic
crisis in decades, a minister said on Monday.
State Minister of the Empowerment of State Enterprises Tanri
Abeng said hopes of economic recovery now hinged on the state
firms following the collapse of major conglomerates.
"At the moment when our conglomerates have gone bankrupt, we
must empower our state firms so that they can become a powerhouse
or locomotive to drive our economy out of the crisis," Tanri told
journalists after officiating at a meeting of the Committee for
Public Policy.
Tanri said the assets of all state firms, excluding the oil
and gas giant Pertamina, totaled Rp 500 trillion (US$45 billion),
up from a mere $500,000 in 1967.
According to Pertamina's reports, its total assets were Rp 32
trillion as of March 1996, excluding the assets of its
contractors.
Tanri acknowledged that not all the firms were profitable --
about 54 percent are categorized as less healthy or unhealthy --
but said they still needed to be taken into consideration.
"Although many of them are not healthy, they are assets which
we must empower."
His efforts, he said, were to restructure and privatize state
firms to make all of the enterprises profitable.
He promised that all efforts to restructure and privatize
state firms would be conducted transparently.
Tanri faced a public outcry when he moved to privatize steel
producer PT Krakatau Steel and cementmaker PT Semen Gresik.
He was accused of not being transparent by offering a stake in
Krakatau Steel to Ispat International without an open tender. He
subsequently promised to publicly tender the sale of the stake in
the firm.
The minister also met public opposition when he wanted to sell
the majority stake in Semen Gresik to foreign investors. The West
Sumatran community petitioned Tanri to refrain from selling PT
Semen Padang, a subsidiary of Semen Gresik, to any foreign
investor. Tanri bowed to the demand and revised the deal in Semen
Gresik to ensure the government retains the controlling interest.
Tanri called on the public, especially critics, to continue to
monitor the process of state firm restructurization and
privatization.
He said the Committee for Public Policy would also give input
to his office on how to restructure and privatize state firms.
Members of the committee include economists Anwar Nasution of
the University of Indonesia, Bambang Sudibyo of Gadjah Mada
University, Didik J. Rachbini of the Institute for the
Development of Economics and Finance, Moslem scholar Nurcholish
Madjid and Sultan Hamengkubuwono X of Yogyakarta. (23)