Indonesia to dissolve, merge underperforming SOEs

Indonesia's State-Owned Enterprises (SOEs) Minister Erick Thohir (front, left) sits with deputy minister Kartika Tiko Wirjoatmodjo (center) (Source: www.thejakartapost.com)

Jakarta (VNA) – The State-Owned Enterprises (SOEs) Ministry of Indonesia will close down or merge state-owned companies that have consistently failed to make profits, as part of the government’s SOEs restructuring plan, according to an official.

Indonesian Deputy SOE Minister Kartika Tiko Wirjoatmodjo recently said that all underperforming SOEs were currently under review, as the ministry is looking to figure out which should be merged and dissolved. The review will also determine which companies will focus their operation on public services, he added.

Earlier, on the sidelines of the Mandiri Investment Forum 2020 in Jakarta, Indonesian SOEs Minister Erick Thohir announced a plan which aims to reduce the number of state-owned firms to 100 from 142 at present in order to improve efficiency.

The ministry will also enlist the help of state-owned asset management company PT Perusahaan Pengelolaan Aset (PPA) to assess which SOEs need to be merged or dissolved, he added.

However, before the ministry can make such big decisions, it has to wait for a new regulation that will give the SOEs ministry broader managerial authority. Currently, the action can only be taken by the country’s Finance Ministry.

Among the Indonesia’s current SOEs, 15 made up about 70 percent of the total profit, which amounted to 210 trillion rupiah (1.5 billion USD) last year./.