Indonesia’s Two-Year Plan to Trim State-Owned Enterprises

RRI.CO.ID, Jakarta - The government is accelerating the reduction of State-Owned Enterprises (SOEs) to around 250 within the next two years to improve efficiency and strengthen financial management.

President Prabowo Subianto said the government has already closed more than 200 of the over 1,000 SOE entities and will continue consolidating until only about 250 remain.

“Imagine, we’ve closed more than 750. This is all the people’s money. These companies aren’t profitable; they’re just paying overhead,” President Prabowo said at the closing of the National Workshop of the Indonesian Science, Technology, and Industry Convention (KSTI) on Sunday, June 28, 2026, as quoted by Antara.

Chief Operating Officer (COO) of Danantara and Head of the SOE Management Agency (BP), Dony Oskaria, confirmed the target. He explained that the streamlining of approximately 1,077 SOEs into 200–300 companies is expected to be completed by 2026.

According to Dony, 52 percent of SOEs are operating at a loss, resulting in losses of around IDR 20 trillion. The government estimates that mergers and streamlining could save up to Rp50 trillion annually.

He cited the merger of several Pertamina subholdings as an example, which generated efficiencies of about USD 600–700 million. A similar model will be applied to other SOE groups to create leaner, healthier, and more competitive enterprises.

Although the number of companies will be drastically reduced, Dony assured that there will be no layoffs. All employees will be transferred to the consolidated companies.

“The President certainly does not want any layoffs,” he said.

Dony added that labor costs amount to only IDR 2–3 trillion per year, far less than the potential savings from restructuring. Therefore, all employees will remain part of the merged companies.

President Prabowo aims to complete the SOE transformation within two years to ensure more efficient governance, profitability, and greater benefits for the national economy. ***