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Three SOEs to get extra $600m injection as House grumbles over lack of communication
The government has increased its state capital injection budget for several state-owned enterprises as a measure to accelerate economic recovery, but lawmakers have criticized it for not discussion the hike beforehand.
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President Joko Widodo visits the Bandung facility of state-owned pharmaceutical company PT Bio Farma in West Java on Aug. 11, 2020. (Biro Setpres/-)
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he government is planning to disburse a total Rp 8.57 trillion (US$607.4 million) in additional state capital injection (PMN) this year to three state-owned enterprises (SOEs) to support its national economic recovery program.
The Finance Ministry’s state assets director general, Isa Rachmatarwata, said on Monday that the additional capital would be injected into infrastructure guarantee fund PT Penjaminan Infrastruktur Indonesia (PII), pharmaceutical holding company PT Bio Farma and the Indonesian Export Financing Institution (LPEI).
The government has allotted capital injections of Rp 1.57 trillion for PII and Rp 2 trillion for Bio Farma, while the LPEI is to receive an additional Rp 5 trillion in PMN this year.
“The capital injections for PII and the LPEI are intended to support their role as guarantors of corporate loans,” Isa explained during a meeting with House of Representatives Commission XI overseeing financial affairs.
Read also: Indonesia targets Rp 40 trillion SOEs injection for 2021 recovery
“As for Bio Farma, we’ve decided to bring forward its PMN disbursement to this year to support its COVID-19 vaccine development,” Isa added.
The government has appointed PII and the LPEI to provide sovereign guarantees for working capital loans from banks to labor-intensive companies. The appointments are part of its program to recover the economy from the COVID-19 downturn, with the government paying the credit insurance premiums on loans ranging from Rp 300 billion to Rp 1 trillion.
