News focus: plan to privatize steel company draws mixed reactions

The government`s plan to privatize state-owned steel company PT Krakatau Steel (KS) has drawn mixed reactions from various quarters.

While facing pressure to choose between privatizing through a strategic sale or through an initial public offering (IPO), the government is also under fire for planning to sell the company.

Legislators want KS to be privatized through an IPO. But critics said the company should not be sold, arguing that the government should instead improve the company`s management.

Reactions have come up to the surface in connection with the government`s plan to privatize state-owned steel making company this year.

Legislators from different factions in the House of Representatives (DPR) on Thursday declared their opposition to the plan if the company was to be privatized through a strategic sale.

The objecting legislators made their stand known in a joint statement. They included Syarief Hasan (faction chairman of Democrat Party), Zulkifli of Prosperous Social Justice (PKS), Alvin Lie of the National Mandate Party faction (FPAN) and Ade Daud Nasution of the Reforms Star Party faction (FPBR).

They said the planned strategic sale of the state company would not benefit the state. It was a fact, they said, that the strategic sale of state-owned satellite company PT Indosat had brought a lot of harm to the state.

The strategic sale system was different from the initial public offering (IPO) system which was applied to state-owned telecommunication company PT Telkom and Bank BRI where the state had enjoyed a lot of benefits.

The Indonesian Democracy Party-Struggle faction (FPDI) even questioned the government`s plan to sell PT Krakatau Steel.

Privatization should be intended to increase the company`s assets, broaden people`s ownership in the company, and encourage it to become a corporate leader in its business field, Hasto Kristyanto of the FPDIP said.

"The best way of privatizing KS is through an IPO which can guarantee transparency and is in conformity with the privatization policy," he said.

However, ...