SOEs Must Open Up To MSMEs, Erick Thohir: Don't Be Ivory Tower

Minister of SOEs, Erick Thohir. (Photo: Instagram @erickthohir)

JAKARTA - SOE Minister Erick Thohir said state-owned companies should take a bigger role in promoting people's welfare. According to Erick, during the COVID-19 pandemic, SOEs have conducted self-introspection and cannot become an ivory tower.

"Since this crisis occurred, we SOEs have appointed ourselves to make improvements. We are transforming ourselves. We ensure that SOEs do not become ivory towers, but must be close to the MSME program and close to the community," he said at the signing of the Supply Chain Memorandum of Understanding. BUMN', Friday, September 3.

Furthermore, Erick said that this appeal had been implemented in the form of a ministerial regulation (permen) regarding the procurement of goods and services for state-owned companies. In line with the issuance of the regulation, the Ministry of SOEs established a Digital Market (PADi) for MSMEs that brought together SOEs with micro to medium-sized companies. Through PADi UMKM, state-owned companies can encourage local product shopping transactions.

"Thank God, we have tested the initiation for more than a year, which was originally started by 20 SOEs, now all SOEs are in the SOEs cluster of 12, (below) there are 43 companies. Thank God it's been consolidated," he said.

Furthermore, Erick said PADi MSMEs have also succeeded in cooperating with 9,600 MSME practices with a total transaction value of Rp. 10.3 trillion until August 2021. Erick is optimistic that the transaction value can increase up to 10 times. Even so, he requested that the quality of the MSME products be maintained.

"So the curation, the standard, must be appropriate. It is important to take sides with TKDN and ensure that standards do not lower so that SOEs can compete in the global market," he explained.

In addition, Erick warned SOE directors to be open to collaborating with other parties, both private and MSMEs. He also reminded state-owned companies not to do rubber, especially the current COVID-19 pandemic.

"There can be no longer one BUMN and the other being a cartel. Trading with each other, supplying each other with each other, whether it's uniform, whether it's drinking water," he said.

The contribution of SOEs to the state reaches IDR 3,290 trillion

Erick admitted that he was not satisfied even though in the last 10 years state-owned companies had contributed to the state of Rp. 3,290 trillion. According to him, SOEs must continue to introspect to improve their performance.

"It has contributed Rp3,290 trillion to the state in the form of taxes, dividends and others. Of course this is very helpful for the country in carrying out programs for its people. But is that enough? No," he said.

SOEs have consistently continued to contribute more than 16 percent to Indonesia's Gross Domestic Product (GDP) since 2018. However, when compared to other countries, the contribution is still relatively small considering that SOEs have total assets of 573 billion dollars or around Rp. 8,022 trillion. .

For example, in the same year, Temasek Singapore's superholding assets of only $227 billion contributed to Singapore's GDP of 21.6 percent.