Indonesia to close more than 750 state-owned enterprises

President Prabowo Subianto announced plans to shut down over 750 state-owned enterprises in Indonesia by the end of the year, as reported by AFP. In his state of the nation address, the president revealed that there were initially thought to be 300 to 400 such enterprises, but a more accurate count of 1,074 was found. Prabowo expressed concern over the unproductive nature of these entities, which often report losses while claiming profits that are merely fabricated.

This revelation came during the presentation of Indonesia's Danantara sovereign wealth fund, which was established the previous year to manage state assets. The president stated that the initial thought of 300 to 400 state-owned enterprises was incorrect, revealing the existence of 1,074 such entities.

As of now, 290 state-owned enterprises have already been closed. By the end of this year, the government aims to close more than 750 enterprises, retaining only those that are productive and generate added value for the public. This massive corporate restructuring could be the largest of its kind globally. Prabowo emphasized that the drive has already resulted in significant savings, amounting to approximately 50 trillion rupiah (over US$2.8 billion) in overhead costs, such as directors and commissioners' salaries, building and car rentals, and business travel. The objective for this year is to save more than 70 trillion rupiah.

To oversee the closure process, Prabowo suggested the establishment of a special ad hoc court to investigate the management and boards of these state-owned enterprises, particularly those dating back 30 years. Additionally, the president proposed the possibility of a special amnesty for those who express remorse for their actions.