JAKARTA – The public is now awaiting the next chapter for State-Owned Enterprises (SOEs), following the House of Representatives of Indonesia’s approval of the revised State-Owned Enterprises (SOE) Law, which includes the establishment of the Investment Management Agency (BPI) Daya Anagata Nusantara (Danantara) earlier this week.

The Indonesian government remains optimistic about the role of BPI Danantara as a superholding overseeing all SOEs. However, concerns are being raised regarding the government’s readiness to manage and supervise this body.

“BPI Danantara is still a subject of debate. Many analysts are concerned about this because Indonesia is deemed not yet morally and politically prepared to operate such a superholding,” said Bella Ghassani, an Investment Analyst at Indoasia Asset Management, when contacted by IDN Financials on Wednesday (5/1).

Reflecting on Singapore’s SOE superholding Temasek, Ghassani explained that having a single financial investment management body for SOEs is necessary. However, this institution must be free from political interference, government capital injections, and should be accountable and transparent.

Without meeting these criteria and having the right competencies, Ghassani noted, BPI Danantara could place state funds at risk instead of generating profits, as seen with the management of Malaysia’s Sovereign Wealth Fund (SWF) Khazanah Nasional Bhd.

“If Indonesia cannot apply the principles of Singapore’s superholding, it may end up resembling Malaysia’s Khazanah,” Ghassani stated.

Meanwhile, Samuel Sekuritas Indonesia, in its research report, projected that asset management efficiency could improve with the formation of BPI Danantara. However, issues related to governance, transparency, and the potential for political interference remain key concerns.

“Danantara’s effectiveness depends on governance & transparency,” Samuel Sekuritas wrote. (KR/ZH)