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🇮🇩 Indonesia /Economy & Trade

West Java BUMD Holding Plan Moves to Ministry of Home Affairs Review

From Republika · (1d ago) Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

TLDR

  • The West Java provincial government is moving forward with plans to establish a holding company for its regional-owned enterprises (BUMD).
  • The plan involves consolidating 36 BUMDs, excluding Bank BJB, with a focus on improving efficiency and contribution to regional revenue.
  • The proposal is currently undergoing administrative review at the Ministry of Home Affairs, with the provincial government awaiting recommendations.

From Bandung, the initiative to consolidate West Java's regional-owned enterprises (BUMD) under a holding company, tentatively named Sanggabuana, represents a significant step towards modernizing and optimizing the province's economic assets. Governor Dedi Mulyadi's administration is pushing this agenda, aiming to streamline operations, eliminate inefficiencies, and ultimately boost the regional income (PAD). This move is not just about corporate restructuring; it's about ensuring that these state-backed entities serve the public interest more effectively.

It is still in process. We are waiting for the governor regulation recommendation from the Minister of Home Affairs.

— Dedi MulyadiGovernor of West Java Dedi Mulyadi commented on the ongoing administrative process for the BUMD consolidation at the Ministry of Home Affairs.

The evaluation of subsidiaries, particularly those deemed ineffective like PT Migas Utama Jabar (MUJ), signals a commitment to good governance and fiscal responsibility. By consolidating 36 BUMDs—28 in finance and 9 in non-finance sectors—the province seeks to create a more robust and competitive business structure. The exclusion of Bank BJB, recognized for its sound financial health, highlights a strategic approach that preserves strong performers while addressing weaknesses elsewhere.

In the future, it will be simplified under the Sanggabuana umbrella.

— Dedi MulyadiGovernor Dedi Mulyadi explained the plan to simplify the organizational structure of BUMDs.

This consolidation is viewed with anticipation by local stakeholders, including the DPRD West Java, which is reviewing the proposal. The analogy used by DPRD Commission III Chairman Jajang Rohana, comparing BUMDs to humans with varying health, aptly captures the need for differentiated management and potential restructuring. The process, currently awaiting administrative approval from the Ministry of Home Affairs, is seen as crucial for unlocking the full potential of West Java's regional economy and ensuring that BUMDs contribute meaningfully to the province's development.

Like humans, some are healthy and some are sick. If not healthy, where is the illness?

— Jajang RohanaChairman of Commission III of the West Java DPRD, Jajang Rohana, emphasized the need to classify BUMDs based on their performance.
DistantNews Editorial

Originally published by Republika in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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