TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results‘New business culture’ needed as govt plans to cut number of SOEs
Danantara CEO Rosan Roeslani’s consolidation drive to reduce the number of SOEs from more than 1,000 to just over 200 will only succeed if accompanied by transparent governance, political will and an overdue reset in the business culture at state firms, economists say.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
CEO Danantara Rosan Roeslani attends the 2025 Forbes CEO Conference on Oct 14 in Jakarta. (Forbes /Forbes)
D
anantara CEO Rosan Roeslani has outlined a five-year plan to consolidate and strengthen Indonesia’s state-owned enterprises (SOEs), but economists warn the move could crowd out private sector activity unless it is guided by clear legal and strategic mandates.
Institute for Development of Economics and Finance (INDEF) deputy director Eko Listyanto said the success of the SOE consolidation would depend on governance and transparency.
“The first thing that must be done in the road map ahead is to make sure the so-called priority and strategic sectors are truly those mandated by law […]. In other words, they should really be the core sectors of the economy. If that’s the case, then it won’t lead to what we call ‘crowding out’,” he told The Jakarta Post on Thursday.
He went on to stress the importance of a level playing field.
“The process must follow a ‘market mechanism’, meaning, even if SOEs compete with private firms, they shouldn’t be given too many privileges. If Danantara keeps getting direct [project] appointments, it will only repeat old inefficiencies,” he warned.
Eko further warned that the success of the massive reorganization would depend heavily on governance and political execution, noting that SOE consolidation had been attempted under previous ministers, like Erick Thohir and Rini Soemarno.
“Inside those 1,000 SOEs are a lot of executives sitting in high positions. If you merge them into 200, many will be thrown out of their chairs,” he said.
