Danantara will have shut down 250 SOEs by end of July: Prabowo

JAKARTA: State asset fund Danantara will have closed 250 state-owned enterprises (SOEs) by the end of July under its consolidation drive, President Prabowo Subianto says.

In a plenary cabinet meeting at the State Palace on Monday, Prabowo hailed Danantara’s progress in reducing the number of state-owned firms over the past 18 months, noting they numbered 1,077 when he took office.

He cited Danantara’s claim that the closures had saved 50 trillion rupiah in overhead costs, including director and commissioner salaries, rental fees and expenses on electricity, transportation and meetings.

By the end of this year, the President aims to reduce the number of SOEs to just 350 firms.

“By Dec 31, I believe, the amount of potential savings can increase. It can reach nearly 70 trillion rupiah to 80 trillion rupiah,” Prabowo said.

He argued that through Danantara, state assets that were previously scattered and difficult to monitor were now well consolidated.

“Thank God, for the first time in our history, we have this sovereign wealth fund Danantara, which has assets worth more than US$1 trillion.

“These are assets that we often have been unable to monitor. We often didn’t even know where our assets were,” he said.

Prabowo reaffirmed his commitment to building modern, efficient and productive governance of state assets, expressing his hope that Danantara’s reform plan could serve as an engine of growth in strengthening national competitiveness, as well as providing “a reserve” and “energy” for future generations.

Danantara has insisted that the restructuring and consolidation of SOEs would not result in mass layoffs.

According to Danantara chief operating officer Dony Oskaria, around 52% of SOEs are currently unprofitable, with cumulative losses reaching 20 trillion rupiah. — The Jakarta Post/ANN