Indonesian Enterprises in Showcase of Success
State-owned Indonesian Enterprises steal the limelight at G20 Forum.
The Republic of Indonesia is riding high as Indonesian enterprises continue to drive a robust economy. The country was able to showcase the outstanding achievements of state-owned enterprises at the recent G20 Forum in Bali. Indonesia’s economic improvement continues due to the recent consolidation exercise by the State-Owned Enterprises Ministry.
The Ministry states that state-owned enterprises’ revenue is on the rise, with an 18.8% increase in 2021. Consolidated profits’ increase by 838% is a strong statement towards the success of such enterprises. By early this year, state-owned enterprises account for 53% of Indonesia’s gross domestic product (GDP) and are worth Rp9 trillion.
The Ministry plans to continue pushing for more consolidation reforms and streamlining of business practices. The target is to bring state-owned enterprises to 43 companies, down from 92 businesses in 2021. This will increase total assets to Rp9.1 trillion by 2024.
The Rise of State-Owned Enterprises
In Indonesia, state-owned enterprises continue to play a crucial role in sustaining the economy from pandemic times. Despite lockdowns, supply chain disruptions, and an overall shortage of medical supplies, these enterprises steadfastly rose to the challenge. State-owned businesses in the health and medical industry were especially crucial in mitigating the pandemic’s effect on the economy.
The latest report from the Asian Development Bank notes that Indonesia’s economy will grow by 5.4% this year. Commodity exports and consumer spending remain robust and continue to generate solid fiscal revenue. Improvements in terms of trade and consumer confidence are also spurring expansion and growth.
Undoubtedly, Indonesian enterprises will continue to play a crucial part in driving the economy. To ensure sustainability, new strategies will come into play to deal with global disruptions such as the Ukraine war. Initiatives include new regulations that impact political leadership roles by commissioners or executives of state-owned enterprises.
Statutory amendments to the 2009 law may facilitate the liquidation of non-performing firms. There is also a proposal to privatise state-owned enterprises earning revenue below Rp50 billion.
A Synergy of Private and Public Interests
The G20 Forum also brought into focus the need for public and private sectors to work together to achieve sustainability. State-owned enterprises comprise Indonesia’s key industries, including energy, logistics, pharmaceuticals, and food distribution. The public sector can help drive reform further with transparency and scrutiny, especially through the public listing of such enterprises.
Moving forward, Indonesian enterprises will continue to play a vital role in boosting the country’s economy. By partnering with the private sector, everyone stands to gain in the long run.
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