Despite his unorthodox approach for justice, Basuki Tjahaja Purnama, or Ahok, is considered unfit to be the leader of BUMN due to the controversies following him. (Image via

BUMN conflict may scare the investors: Experts

The economic experts in Indonesia worry that the “unnecessary” controversies following the appointment of the commissioner and members for the board of directors (BoD) for the state-owned enterprise (BUMN) will scare the investors.

As it is known, currently, the Minister of BUMN, Erick Thohir, is summoning prospective commissioners and members of the BoD for the BUMN. However, not all of them received a warm welcome from the Indonesian people. One of them is Basuki Tjahaja Purnama, generally known as Ahok.

Indonesian economic experts proved the concern of the capital owners is evident, judging from the sluggish movement of BUMN’s shares in recent months. BUMN relies on capital owners both domestic and foreign. In the recent 5 years, BUMN’s total debt has grown by 60 percent.

Therefore, it is better to focus on a leader able to solve the structural problem and give good corporate governance for the BUMN. As an indicator of bad corporate governance, many of the previous commissioners and members of the BoD are caught in the nasty net of corruption.

For the appointment of the BUMN’s VIP, Indonesian economic experts voted for a selection process. Through a selection process, the investors will be able to check the candidates’ credibility to trust their capital for the BUMN.

Not only selection but also long-term development conception for the BUMN is required. For example, Singaporean BUMN, Temasek Holdings, and Malaysian Khazanah Nasional Berhad are adapting a long-term development conception for their BUMN.

With the development conception, the government can see explain to the investors about the appointment of the BUMN’s commissioners and members of the BoD and how their appointments are following the development concept’s target.

However, until now, the Indonesian government has not unveiled its long-term development program to the public. Even, they had not given any solution for “underperformed” BUMN such as PT Asuransi Jiwasraya and PT Krakatau Steel.