STATE-OWNED COMPANIES' PROFIT EXPECTED TO REACH RP90 TRILLION

Jakarta, Jan 12 (ANTARA) - State Enterprises Minister Mustafa Abubakar said the net profit of state-owned companies is expected to rise to around Rp90 trillion this year from around Rp74 trillion in 2009.

"The target is quite realistic in line with the continuing program of corporate restructuring, regrouping and efficiency improvement and production growth," the minister said here on Tuesday.

He said the income of state-owned companies meanwhile was expected to reach Rp1,050 trillion or grow by around 13 percent from last year's income of Rp930 trillion.

Most of the 139 state-owned companies in general made a significant progress last year, he said.

Their total assets are expected to reach Rp2,400 trillion rising 11.6 percent from the projected Rp2,150 trillion.

Capital expenditures meanwhile are set at Rp785 trillion, up from the 2009 forecast of Rp710 trillion.

Mustafa said the target of net profit for 2010 was set based on various factors such as the implementation of the ASEAN-China Free Trade Area (ACFTA).

He admitted the implementation of the ACFTA would affect the market share of several sectors such as iron and steel which would be flooded by products from China while emphasizing the importance for the government to impose a national industrial standard (SNI) on products from China and of pushing domestic companies to produce quality products and services.

"It is also important to assure the continuity of supply of fuel oils, gas and electricity power to support the domestic industries' bargaining power," he said.

Mustafa said a variety of programs had been carried out such as the restructuring of sugar and fertilizer industries and a number of companies with good results.

So, the bargaining power of the domestic commodities would increase, he said.

The minister admitted that in 2009 expansion of a number of state-owned companies had not gone smoothly under the backdrop of global economic crisis.

His secretary, Muhammad Said Didu, said the state-owned companies' financial performance in 2009 improved and was projected to rise in 2010 driven by success in the implementation of good corporate governance.

"The good corporate governance has been implemented well in the state-owned companies so that it could be taken as an example for other companies," he said.

The increasing performance of the state-owned companies was reflected in the drop in the number of state-owned companies that made a loss.***2***
R017