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.
Is Sritex too big to fail?
The idea of the state using taxpayer funds to save a private textile company is problematic for a number of reasons, and the desire to save jobs is a weak argument to justify such a move.
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!
Workers leave a PT Sri Rejeki Isman (Sritex) factory in Sukoharjo, Central Java, on Oct. 24, 2024. (Antara Foto/Mohammad Ayudha)
PT Sri Rejeki Isman (Sritex) is a massive textile company, but is it too big to fail?
There has been a chorus of calls for the government to swing to the rescue of the Central Java-based manufacturer since it was declared bankrupt last week in a ruling it has appealed.
Something must be done, is the gist of those calls, which have come from both managers and labor representatives, but just what might be done is far from clear.
The Industry Ministry has reportedly asked the company itself to draw up a plan, like a doctor asking a terminally ill patient to suggest a course of treatment.
President Prabowo Subianto summoned Manpower Minister Yassierli, Finance Minister Sri Mulyani Indrawati and Coordinating Economic Minister Airlangga Hartarto on Tuesday to discuss Sritex.
Emergency funds or incentives are reportedly on the table. Even a bailout has been discussed for the company that had around US$1.6 billion in total liabilities as of June.
However, the idea of the state using taxpayer funds to save a private textile company is problematic for a number of reasons, and the desire to save jobs is a weak argument to justify such a move.
