Indonesia announces reform of 12 state-run firms
The Indonesian government announced Wednesday the names of five state-owned listed enterprises that will be further divested and seven others that will be privatized under a recent agreement with the International Monetary Fund (IMF) to raise badly needed funds to finance the government's inflated spending.
''The proceeds from the share sales will be used mainly to help cover the budget deficit of fiscal 1998,'' Tanri Abeng, minister for empowerment of state enterprises, told an international media conference at the presidential office.
The fiscal 1998 deficit is estimated at 3.2% of the gross domestic product.
The five enterprises that have been listed on the stock exchange are domestic telecommunications operator PT Telkom, international telecommunications operator PT Indosat, cement producer PT Semen Gresik, tin miner PT Tambang Timah, and mining company PT Aneka Tambang.
The seven being prepared for privatization are steel company PT Krakatau Steel, ports infrastructure and management companies PT Pelabuhan Indonesia II, and PT Pelabuhan Indonesia III, toll roads company PT Jasa Marga, palm oil plantation PT Perkebunan Nusantara IV, coal miner PT Tambang Batubara Bukit Asam, and airports management company PT Angkasa Pura II.
''In addition, we are preparing several other state enterprises as reserves if the to-be-privatized seven firms, for certain reasons, have not been able to be privatized in the future,'' Tanri said.
According to Tanri, the government has projected it could raise 15 trillion rupiah (about 2 billion U.S. dollars) from the further divestment and privatization.
Tanri, however, stressed the procedures for the divestment and privatization, including the sales process, will be transparent ''to create an openness in the offering in line with the market mechanism.''
President Suharto has stressed that the state ownership should be maintained at 51%.
The privatization program is part of the reform package the government has agreed to with the IMF in exchange for a 43 billion dollar bailout fund.