Jakarta – Hundreds of workers from some 15 labor unions representing workers in state-owned enterprises (SOEs) staged an anti-privatization protest in Jakarta on Tuesday as part of a campaign to pressure the government to abandon the program, which is seen as being crucial to the country's economic recovery hopes.
Secretary-general of the Federation of SOE Labor Unions Nazir Safrie said that the privatization program would only inflict losses on the country, including massive layoffs.
"The government just wants to sell, sell and sell the SoEs ... to meet its budget targets. We are against such measures," he told reporters. He added that a privatization law must first be introduced before the government proceeded with the sell-off program.
During the one-day rally, the workers went to the presidential palace and to the Office of the State Minister of State Enterprises to voice their demands. But neither President Megawati Soekarnoputri nor Laksamana Sukardi showed up to meet them.
Labor unions participating in Tuesday's rally included those from the West Sumatra-based cementmaker PT Semen Padang, telecommunications firms PT Indosat and PT Telkom, Bandung-based aircraftmaker PT Dirgantara Indonesia, and Surabaya-based electricity transmission company PT PJB.
The current anti-privatization campaign could trigger larger protests with the potential to derail, or put a brake on, the government's privatization program.
Over 120 labor activists from around the country gathering here for a labor union conference had earlier warned against pursuing trade liberalization and the privatization of SOEs as it would only create misery for Indonesian workers.
The government has included 25 SOEs in its 2002 privatization list as part of a bid to raise around Rp 6.5 trillion (US$698 million) to help plug the state budget deficit, which is estimated at Rp 42 trillion, or 2.5 percent of gross domestic product.
The House of Representatives' Commission IX on financial affairs recently approved the plan, although some legislators still insisted that the government must continue to consult with them on the privatization of individual SOEs.
The privatization program is also part of a deal agreed with the International Monetary Fund, which is sponsoring the country's economic reforms. Backtracking on such a key program could strain relations between the Fund and the government, which in turn would affect investor sentiment, analysts have said.
The government failed to meet its privatization program target last year for various reasons, including widespread protests over plans to sell a controlling stake in cementmaker PT Semen Gresik to Mexican cement giant Cemex SA de CV.
Separately, in Padang, West Sumatra, the Semen Padang labor union reiterated on Tuesday its opposition to the sale of Semen Padang to Cemex. They said that they would launch a campaign to expel Cemex officials from the province if they dared to go ahead with their acquisition plan. Semen Padang is 100 percent owned by Semen Gresik.
The workers demanded that the government spin off Semen Padang from Semen Gresik if it wished to proceed with the sale plan.
Meanwhile, Revrisond Baswir, an economist from the Yogyakarta-based Gadjah Mada University (UGM), also said that hasty moves to privatize state enterprises would merely inflict losses on the people. The government should wait until the country's economy recovered from the crisis so as to obtain optimum proceeds from the sale of the SOEs.