Jakarta (VNA) – Indonesia has dissolved more than 200 underperforming state-owned enterprises (SOEs) and is accelerating a sweeping restructuring of its state sector to improve governance efficiency and reduce the fiscal burden.
President Prabowo Subianto said the government aims to cut the number of SOEs and their subsidiaries from more than 1,000 at present to around 250 by the end of 2026.
He said the streamlining effort is intended to eliminate chronically loss-making enterprises that continue to maintain oversized management structures and high operating costs. The restructuring is also expected to generate significant savings in administrative expenses, strengthen transparency, and channel resources toward more competitive and efficient enterprises.
SOE reform is one of the Indonesian government's key economic priorities. The country's state-owned enterprises continue to play a central role in strategic sectors, including energy, electricity, telecommunications, banking, infrastructure, mining, and logistics. They are also instrumental in implementing national priority projects covering infrastructure development, manufacturing, energy transition, and social welfare.
However, assessments by the Organisation for Economic Co-operation and Development, the World Bank, and other research organisations have highlighted persistent challenges in Indonesia's SOE sector. These include an excessive number of enterprises and subsidiaries, uneven operational performance, prolonged losses at some companies, cumbersome management structures, and governance shortcomings.
Against this backdrop, the restructuring programme is expected to enhance the efficiency of state capital utilisation, improve the investment climate, and strengthen the competitiveness of Indonesia's economy./.
