Jakarta. The government will inject Rp 39.4 trillion ($2.8 billion) into state-owned enterprises next year as part of its strategy to increase their involvement in the national development agenda over the next five years.
The capital injection marks a continuation of efforts by the government to beef up the capacity of SOEs as “agents of development” in five priority sectors: food security, infrastructure and maritime development, energy security, strategic industry development, and national economic autonomy.
Still, the allocated budget for SOEs in the 2016 draft state budget is 39 percent less than the Rp 65 trillion in this year’s budget.
The 2016 budget, which is pending approval from the House of Representatives, will see SOEs in the infrastructure and maritime industries get 48 percent of total capital injection, with infrastructure financer Sarana Multi Infrastructure receiving up to Rp 5 trillion.
Construction firms Hutama Karya and Wijaya Karya will get Rp 3 trillion each.
Electricity monopoly PLN is slated to receive the biggest amount at Rp 10 trillion, double the capital injection in received this year, while food procurement agency Bulog will receive Rp 2 trillion.
In transportation, airport operator Angkasa Pura II will receive Rp 2 trillion and toll road operator Jasa Marga Rp 1.25 trillion.
Some of the projects expected to be jump-started through the capital injection next year include four toll roads in Sumatra, a new runway at Soekarno-Hatta International Airport, and the development of a high-speed rail line from Jakarta to Bandung.
The government also aims to start the construction of rice processing and storage facilities, as well as two geothermal power plants in Dieng, Central Java, and Patuha, West Java, next year.
The government is projecting a cut in dividends from SOEs by 16 percent next year to Rp 31.16 trillion on the back of sluggish economic growth, according to Askolani, the Finance Ministry’s director general for budgeting.
“As we look at this year’s [SOEs’] profit, we’re considering giving them a chance to invest more,” Askolani said. “They can take advantage from investment and additional funding injection from the government.”