The Indonesian government is throwing its weight behind the State-Owned Enterprise (SOE) Bill, set to be deliberated at the Second Level Plenary Meeting of the House of Representatives (DPR). This show of support was made clear by Minister of Law Supratman Andi Agtas, who stood in for the president, minister of SOEs, finance minister, and minister of state secretary during a meeting with DPR Commission VI at the Parliament Complex over the weekend.
With a level-headed approach and after considering input from various factions, Minister Agtas, representing President Prabowo Subianto, voiced backing for the Third Amendment to Law Number 19 of 2003 concerning SOEs. The proposed amendments aim to address key aspects of SOE governance and operations to boost their competitiveness and contribute to Indonesia’s economic growth targets.
Key Points in the Bill
The proposed amendments outlined in the bill include several critical elements that are expected to reshape the landscape of SOE operations in Indonesia. First and foremost, the bill seeks to grant ministers the authority to act as the government’s representatives in overseeing SOEs. This move is aimed at streamlining decision-making processes and ensuring alignment with government policies and objectives.
Secondly, the bill proposes the establishment of the Daya Anagata Nusantara Investment Management Agency (BPI Danantara) to enhance the management of SOE dividends. This agency is envisioned as a strategic platform to optimize the financial performance of SOEs and unlock new avenues for growth and investment.
Furthermore, the bill focuses on strengthening the governance framework of SOEs by delineating clear roles for regulators, shareholders, and supervisors. By enhancing coordination among various government ministries and agencies, the bill aims to foster a more cohesive and efficient ecosystem for SOE operations. Additionally, the bill seeks to confirm the status of SOE assets as distinct state assets, aiming to provide a solid legal foundation for corporate actions and strategic decision-making.
In his remarks, Minister Agtas underscored the importance of these proposed changes in empowering SOEs to navigate the evolving business landscape and contribute meaningfully to Indonesia’s economic development. By bolstering the competitiveness of SOEs, the bill aligns with the economic growth targets set by the current administration, signaling a proactive stance towards fostering a more dynamic and resilient SOE sector.
Consolidation of SOE Assets
SOE Minister Erick Thohir also weighed in on the proposed amendments, highlighting the consolidation of SOE assets under the purview of BPI Danantara. This consolidation effort, pending inauguration by President Prabowo Subianto, is grounded in the principles of good corporate governance (GCG). By centralizing the management of SOE assets under BPI Danantara, the government aims to enhance transparency, accountability, and efficiency in the management of SOE resources.
The consolidation of SOE assets under a unified investment management agency reflects a strategic shift towards a more integrated and coordinated approach to SOE governance. By leveraging the expertise and resources of BPI Danantara, SOEs are poised to unlock new growth opportunities, optimize their financial performance, and navigate the complexities of the global business environment with agility and resilience.
As the deliberation of the SOE Bill moves forward, stakeholders across the public and private sectors are closely watching the developments unfold. The proposed amendments hold the promise of ushering in a new era of governance and management for SOEs in Indonesia, setting the stage for enhanced competitiveness, sustainable growth, and greater alignment with national development goals.
The Indonesian government’s endorsement of the SOE Bill underscores its commitment to strengthening the foundations of the SOE sector and fostering a conducive environment for sustainable economic growth and development. By prioritizing transparency, accountability, and efficiency in SOE governance, the proposed amendments aim to unleash the full potential of SOEs as engines of growth and prosperity for Indonesia and its people.
