Minister Sofjan Djalil addresses European companies on policy for state-owned companies

On 25 March, at the joint luncheon of the European Chambers of Commerce, Minister of State-Owned Enterprises Sofjan Djalil set out his vision for the state-owned companies in Indonesia. He started out to deny that his privatization plans have been postponed, merely saying that the expected proceeds from privatization would not be included in this year's fiscal budget. He acknowledged the strong political barriers, especially from the parliament, which he is facing in his reform of the state-owned sector. He did not give a vision on which sectors should be controlled by the state and which sectors should be fully privatized.
He wants to create sector-based holding companies for the 140 companies owned by the national government (companies owned by local governments are not under the control of his Ministry). These holding companies will then be held by one or a few national holding companies, comparable to Singapore's Temasek Holding. The Minister is placing strong emphasis on professional management and corporate governance that will allow corporate decision making without his ministry's involvement. He emphasized that top managers of state-owned companies are increasingly recruited from the private sector, and that they will be fired if they make mistakes. He vowed to further open up the sectors in which state-owned companies operate to private competition, like in the downstream oil industry where thanks to competition from Shell and Petronas the performance of Pertamina stations has much improved.