Indonesia Plans to Cut State Companies From About 1,000 to 250

Indonesia's government plans to reduce the number of state-owned enterprises from more than 1,000 to about 250, President Prabowo Subianto's administration said, presenting the consolidation as a way to improve efficiency and transparency. The state news agency Antara reported that the plan would combine a sprawling collection of state firms into a much smaller group of larger entities.

To manage the political risk, the government has pledged no job cuts as part of the restructuring. Officials say employees of merged or dissolved companies would be reassigned rather than laid off, an attempt to win support for a reform that affects a large share of the formal economy.

For Southeast Asia's largest economy, the move is a significant test of whether a state-heavy model can be made more efficient without the disruption that usually accompanies such overhauls. Consolidating hundreds of firms promises clearer accounting and less duplication, but pledging to keep every worker limits how much genuine efficiency the exercise can deliver. The credibility of the plan will rest on whether the larger entities actually operate on commercial terms or simply repackage the same liabilities under fewer names.