State-Owned Firms to Be Trimmed

JAKARTA ~ The government is to reduce the number of state-owned companies from 139 to 69 by 2009 through privatization or liquidation, Vice President Yusuf Kalla said.

“The target in 2009 is set at 69 state-owned companies. Some of them should be merged, privatized or liquidated,” the official Antara news agency quoted him as saying late on Monday after a meeting at the State Enterprises Ministry.

Kalla said that number could be further cut to 25 by 2015.

He said state firms’ profit before tax was projected to grow 22.5 percent this year to reach Rp88.75 trillion (US$980 million), against a projected Rp72.44 trillion in 2006.

“Many state firms are very good in terms of performance and financial capacity, and only a few are not good and must be improved,” Kalla said after the meeting that examined the performance of state-owned companies.

State Enterprises Minister Sugiarto said his ministry had drawn up a roadmap for the privatization program but did not give details of the firms to be privatized.

Indonesia’s privatization program was initially part of reforms mandated by the International Monetary Fund in the wake of the 1997-98 Asian financial crisis.

The government decided to continue with the program even after the IMF ended its Indonesia mission in 2004.

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