JAKARTA (TheInsiderStories) – Indonesia and Laos state companies will conduct business cooperation in various fields ranging from railroad infrastructure, mining, to agriculture. This was revealed from the results of the visit of state-owned enterprises (SOEs) minister Rini Sumarno to Laos on Tuesday (06/25).
In a written statement, Sumarno said the signing of a memorandum of understanding on cooperation between a number of Indonesian SOEs and Phonsavanh Group which had the support of the Laos government, namely Petrotrade and Phaiboun Import and Export Trading was held after a meeting with the Prime Minister of Laos Thongloun Sisoulith in Vientiane, Laos on late Tuesday.
In the field of infrastructure and transportation, the Indonesia Railway Development Consortium (IRDC) consisting of PT Railroad Industry, PT LEN Industri, PT Kereta Api Indonesia, and PT Waskita Karya Tbk (IDX: WSKT) agreed to explore cooperation with Petrotrade in the field of railroad development from Thakek in Laos to Vung Ang Port in Vietnam.
IDRC will build a 195-kilometer train line from Laos to the port area in Vietnam. The Rp9 trillion (US$634 million) project will support Indonesia’s coal exports to Laos and Laos’ potassium imports to Indonesia.
For the mining sector, Indonesian publicly listed miner PT Timah Tbk (IDX: TINS) and PT Pupuk Indonesia collaborated with Petrotrade in the mining sector. Where Timah and Petrotrade agreed to explore prospective mining areas until the processing process.
One of the explorations from the mining that will be carried out is to find a new source of raw material for NPK fertilizer, namely potassium chloride. For this, PT Pupuk Indonesia is ready to contribute as a buyer that will absorb the fertilizer raw material. As for Indonesian coal miner, PT Bukit Asam Tbk (IDX: PTBA), which agreed to cooperate in coal buying and selling with Petrotrade.
Furthermore, in agriculture, PT Perkebunan Nusantara and PT Pupuk Indonesia and Perum Bulog also formed a partnership with Phaiboun Trading Import and Export.
Sumarno views Laos as a country with enormous natural resource potential and has many business opportunities that can be collaborated with Indonesian SOEs.
“Our team has conducted surveys and meetings with the central and regional governments in Laos, as well as partner companies in Laos. “We see several business opportunities that can be jointly developed in the fields of mining, agriculture, and infrastructure,” he said.
Sumarno also explained that SOEs in Indonesia currently has a very important role in building the country and improving people’s welfare. SOEs are not only responsible for seeking profits but also become agents of change and provide added value to the community.
From year to year, the performance of Indonesian SOEs continues to increase. Recorded on December 31, 2018, the total assets of SOEs reached $573.93 billion. Increasing rapidly compared to assets in 2015 which only reached $402.8 billion.
The overall profits of SOEs also continue to increase. In 2015, SOEs profits amounted to $10.49 billion, but in 2018, it increased significantly to $15 billion. Supported also by a capital expenditure of $31.8 billion, a figure that is quite aggressive in supporting infrastructure development in Indonesia.
Written by Lexy Nantu, Email: firstname.lastname@example.org