TEMPO.CO, Jakarta - Minister of State-Owned Enterprises (SOE) Erick Thohir has specially ordered state-owned banks to reduce interest rates for Small and Medium Enterprises (SMEs), in order to maintain industry stability in the midst of the COVID-19 outbreak.

"Businesses today need to continue. We want SOE Banks to lower their interest rate for SMEs so that the economy can continue" Erick said in a live broadcast from his office, Central Jakarta, on Friday, March 20, 2020.

Aside from submitting the policy to the Financial Services Authority (OJK), Erick ensured that the policy has also been discussed with the Bank of Indonesia and other relevant ministries.

On top of that, Erick has ordered banks to relax loans for debtors affected by the pandemic. In particular, according to him, businesses engaged in the tourism sector such as hotels, restaurants, and airlines.

On the other hand, from the monetary side, state-owned companies have been asked to issue additional bonds, geared to strengthen their foreign exchange reserves. "But these bonds are from state-owned companies that have good ratings, such as BRI and Mandiri," said Erick.

Erick explained that the bonds, including the amount to be issued, are still in the proposal stage as the Ministry of SOEs is waiting for the right time, taking into account market conditions.

In addition to issuing bonds, Erick has asked six state-owned enterprises, including BRI Bank, Mandiri Bank, Pertamina, PT BA, Telkom, and Jasa Marga, to buyback their shares.

The Ministry of SOEs has prepared IDR 1 trillion to buyback SOE shares. "But, this budget is not for purchasing shares in one day," Erick said while ensuring that the buyback will be carried out in stages to maintain capital market stability.

FRANCISCA CHRISTY ROSANA