Indonesia’s parliament passed a law to lay a foundation for a new state-owned company to manage billions of dollars in state assets, while also seeking investment from both within the country and potentially abroad.
On Tuesday, lawmakers, most of which belong to President Prabowo Subiento’s ruling coalition, approved the amendment to the country’s state-owned enterprise law in a plenary session.
State-Owned Enterprises Minister Erick Thohir said in the parliament that the new law would lay the ground for the creation of Daya Anagata Nusantara, or Danantara, to consolidate Indonesia’s state-owned companies, while also supervising their operations, investment, and dividends.
The agency, overseen by ministers and reporting directly to the president, will help the administration achieve its goal of 8% economic growth within Prabawo’s term, said Thohir.
According to the drafted legislation as seen by Bloomberg News, Danantara will be established with around IDR 1,000 trillion ($61 billion) in capital through cash, state owned assets, or government owned shares.
Danantara is one of Prabawo’s key initiatives to allocate more fundings to his various government projects including free school launch program, expanding public housing, and food and energy self-sufficiency. The president aims to boost Indonesia’s economy without bloating the national budget.
Though it is not clear which state-owned enterprise would be incorporated into Danantara, Thohir remarked. Local media has previously suggested that seven state assets could be transferred to the agency, this include major companies such as PT Bank Mandiri, Mining Industry Indonesia, and state-owned fossil fuel giant PT Pertamina.
