14 June 2022 (closed)
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One characteristic of the Indonesian economy is that the state-owned enterprises (SOEs) play an important role in this USD $1.0 trillion economy. They not only play an important role because some of them rank among Indonesia’s biggest companies (in terms of profit, sales and assets), thereby generating plenty of money for the government (in the form of tax revenue or dividend) while at the same time creating jobs for millions of Indonesians.
But they also play a crucial role in the economy because many of Indonesia’s SOEs have important public policy objectives. Energy giant Pertamina can serve as a good example. Pertamina, which is fully owned by the Republic of Indonesia, is tasked with providing, managing, and distributing fuel throughout the country.
This energy giant has in fact been forced by its sole shareholder to sell premium-branded gasoline as well as solar-branded diesel at prices that are well below market prices with the argument that lower fuel prices contribute to national economic growth, and poverty reduction.
Read the full article in the December 2019 report
This article discusses:
• The public policy objectives that are given to the SOEs and subsequent financial pressures for these companies
• Why does the government need to rely on the SOEs when it comes to economic and social development (why not the private sector)?
• President Widodo's dream for the SOEs to become global actors in their respective sectors, becoming internationally recognized companies with great reputations and great competitiveness
• Erick Thohir's first months in office as Minister of State-Owned Enterprises. What decisions has he made so far?
• What are Indonesia's biggest SOEs in terms of profit and assets?