Indef: The State-Owned Enterprises External Debt Has Raised IDR 996 Trillion Until The Third Quarter Of 2020

JAKARTA - The Institute for Development of Economics and Finance (Indef) noted that the foreign debt of state-owned enterprises (BUMN) experienced a significant increase after 2015 to 2016. Based on the results of research conducted by Indef, up to the third quarter of 2020 debt in the financial sector and non-financial through IDR 996 trillion.

Researcher at the Center of Macroeconomics and Finance Indef, Deniey A. Purwanto, said that this significant increase in SOE foreign debt occurred in 2018. Where debt in the financial sector was in the position of 23.44 percent. When compared with 2017 which was at 0.10 percent, this figure is higher.

Based on Indef's research, Deniey said the foreign debt of non-financial SOEs was recorded at 41.64 percent in 2018. That number is higher than in the previous period, namely 5.14 percent.

Furthermore, Deniey said that in the last few years, BUMN debt had shown a quite rapid trend of increasing both BUMN financial institutions and non-financial institutions.

"When we compare financial SOEs and non-financial SOEs, we have to remove savings and deposits from debt, but we still see that the development of BUMN financial institutions and non-financial institutions debt has increased quite drastically in the last few years", he said in a virtual discussion, Wednesday, March 24th.

In 2020, said Deniey, the BUMN debt was recorded to have decreased significantly. In this period, the state company's debt was only 10.5 percent for financial institutions. Meanwhile, non-financial only recorded 12.99 percent.

On the other hand, he said, when compared to the external debt of financial and non-financial SOEs, the ones that are mostly absorbed are BUMN with core business or infrastructure core business. This is related to the assignment from the government. An example is the development of a number of national strategic projects (PSN).

"Since 2018, the debt of non-financial SOEs has increased much more rapidly than non-financial institutions. This is also related to assignments and infrastructure development in Indonesia", he explained.

Deniey said that there are differences regarding the maturity of foreign debts. There is a time structure that distinguishes between financial and non-financial SOE debt.

"The debt of financial SOEs is dominated by short-term debt, while non-financial SOEs are dominated by long-term debt", he said.