Sandiaga Explains Strategy to Settle SOE Debts of Rp5,000tn

TEMPO.CO, Jakarta - Vice presidential hopeful Sandiaga Uno is currently mapping out strategies to settle debts of state-owned enterprises (SOE) which he deems quite alarming. According to him, insight on each corporation is required to solve the issue due to its function as a corporate entity.

“We have to see the sustainability of SOE. If the debt is too high, each corporation must be encouraged to do right-sizing, asset securitization, or conduct debt restructuration, and so on,” said Sandiaga in Ambhara Hotel, Jakarta, Wednesday, December 12. Besides that, he will also promote the principle of professionalism and good corporate governance.

According to Sandiaga, the hike of state debt is caused by stagnant income, while the country’s expenditure increases. “Debt of SOEs now enters to government and public debt,” he added. “If this is combined, the number is extraordinarily huge at over 60 percent of the national gross domestic income (PDB).”

Sandiaga explained that strategies to overcome the problem is simple, for example, by increasing state revenue and start savings, while a way to save without stopping the development project is by applying partnerships between the government and business entities. “I believe the government has it, but it’s not optimally used and has not been executed faster yet,” he noted.

The former Jakarta deputy governor further highlighted the high of SOEs debt. Moreover, he has heard that the debt reaches Rp5,000 trillion. “This public debt is at over 60 percent, not to mention SOEs debt. It’s worrying,” Sandiaga stressed.

According to him, the public must be concerned and worry about this subject because threats from economic instability either from global or local can follow this condition. “What if there is slow economic growth, what if trade war continues, what if prices of commodities strongly drop?,” Sandiaga Uno remarked.

Earlier on, the SOE Ministry's deputy for business development and restructuring Aloysius Kiik Ro revealed that SOE debts reached Rp5,271 trillion, but all of it did not come from the real debt. He outlined SOE debts in the financial sector amounted to Rp3,311 trillion, the Third Party Fund Growth (DPK) at Rp2,448 trillion, and insurance premium and others at Rp335 trillion.

CAESAR AKBAR