Why Is Prabowo Targeting a Cut in State-Owned Firms to 300?
Prabowo plans to cut Indonesia's state-owned firms to 300 by year-end, citing restructuring, cost savings and the need to retain productive companies.
President Prabowo Subianto announced plans to reduce the number of state-owned enterprises (SOEs) in Indonesia to no more than 300 by the end of 2026. This move is part of a government restructuring effort aimed at retaining productive companies that can generate value for the public. Prabowo revealed that the government had identified a total of 1,074 SOEs, including parent companies and their subsidiaries.
During a state address at the Annual Session of the People's Consultative Assembly (MPR) in Jakarta on August 14, 2026, Prabowo mentioned that many of these SOEs were found to be unproductive and continued to post losses. Consequently, the government plans to streamline the state-owned sector and shut down companies that are making little or no contribution.
So far, the government has closed 290 SOEs, leaving a target of no more than 300 by December 31, 2026. Prabowo emphasized that only productive and value-creating companies will be retained after the restructuring.
The government restructuring has also resulted in significant savings, with the government saving around Rp50 trillion so far. These savings were achieved by cutting directors' and commissioners' salaries, reducing office rentals, vehicles, and official travel expenses. The funds saved could be redirected towards public needs, such as renovating community health centers and schools, and building housing. Prabowo stated that the goal is to save more than Rp70 trillion by December 2026.
Written by urgent.news from Tempo.co English's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
