Jakarta, Oct 11 (Antara) - Some 800 subsidiaries of 118 state-owned enterprises (SOEs) need to merge to reduce their domination in business sectors, so that small-scale private firms will have greater access to government projects.
This issue was raised by Rosan P. Roeslani, general chairman of the Indonesian Chamber of Commerce and Industry (Kadin), at its national meeting last week. In his speech, Roeslani highlighted the dominant roles played by SOEs in government projects due to which national private firms had lack of ample opportunities to secure projects.
"We hope the opportunity would first be given to national firms if they are unable to implement the projects and only then should they be offered to SOEs," Roeslani remarked during the meeting attended by President Joko Widodo (Jokowi).
There are several projects handled by SOEs and their subsidiaries, including small projects offered to their subcontractors, which should have, in fact, been offered to private firms and small companies.
Kadin expressed hope that SOEs would implement projects that can become their core areas of business and would not seize portions that should be carried out by the nation's private and small-scale companies.
"We hope that SOEs would return to conducting business in their core areas," Roeslani stressed.
However, Roselani said Kadin will synchronize its policies for local businesses in line with those of the government, with the aim of creating job opportunities while simultaneously reducing the economic gap and poverty.
At the national coordination meeting, his office will collect strategic feedback from industry players, which will then be communicated to the government.
"We will gather strategic feedback from businesses, and we will synchronize our steps in line with the government's policies," he stated in Jakarta on Tuesday.
He further noted that currently, his office was aiming to boost the creation of jobs to be supported by the government's policies for creating a conducive business environment, boosting economic growth, and increasing competitiveness of the nation's business sectors.
Speaking in connection with the domination of SOEs, President Jokowi admitted that 118 SOEs had transformed into 800 subsidiary companies.
"There are only 118 SOEs that have about 800 children, grandchildren, and great-grandchildren (subsidiaries and branches up to the smallest units). However, the existence of these children, grandchildren, and great grandchildren is not because of me. They have been there since long," the president said.
Jokowi confirmed what was stated by the Kadin chairman with regard to the domination of SOEs in the business sector in Indonesia and claimed to have ordered SOEs to merge or even be sold.
"At a plenary meeting yesterday, I ordered the merger. Some 800 of them should be merged or else be sold. There is no need for SOEs to be involved in catering or laundry services," Jokowi stressed.
Hence, the head of state has urged that during a future meeting with Kadin, details that could be discussed, resolved, and decided should be prepared. He also sought the participation of managers of Kadin's branch offices during the next meeting to discuss the types of business that could be offered to the local subcontractors.
In the meantime, SOE Minister Rini Soemarno denied claims that several SOEs were eating into the business of micro, small, and medium enterprises (UMKM) in small projects.
Minister Soemarno admitted feeling offended by the statement made by Roeslani at a national meeting on Tuesday (Oct 3), saying that SOEs, along with their subsidiaries, played significant roles that had the potential to shut down certain projects of private companies and UMKM.
"I frankly admit that I am offended, as we feel that during these three years, SOEs have not only been encouraged to concentrate on developing themselves but also on ways to make their directors and managements realize that there are still several people who belong to the very low income group," the minister said in a dialog with the media at the Plaza Mandiri in Jakarta on Thursday night (Oct 5).
The minister explained that SOEs had a diverse program in place to develop low-income communities to help them carry out economic activities.
SOEs have encouraged and developed small and medium enterprises as well as most microbusinesses that had failed to acquire capital loans from banks, as they were viewed as being risky.
"We gave (capital loans) amounting to Rp500 thousand to Rp3 million, and now, we have helped up to 1.3 million people. This did not as yet include microbusinesses that received Rp5 million to Rp25 million from BRI and BNI banks," she revealed.
She also admitted that SOEs have a large number of subsidiaries and branches up to the smallest units, reaching 800. The minister cited several state-owned companies that had set up subsidiaries in the same business, such as hospitals, reaching 70, and will be incorporated in a sub-holding of state-owned hospitals.
Soemarno believes that with the consolidation of subsidiary sub-holdings, state-owned companies would become more efficient and better and achieve the same standardization of quality.
"Now, the problem is how to make the consolidation process efficient and offer better services, and one should not forget that SOEs are public companies that should think about sustainability and earn benefits," the minister noted.***3***(A014/INE)
EDITED BY INE/H-YH(T.A014/A/BESSR/A/Yosep) 11-10-2017 19:16: |
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