Jakarta – Five Indonesian state firms suffered losses or potential losses of four billion dollars due to inefficiency over in 1995-1999, according to independent international auditors. The audit results were reported in Friday's Jakarta Post and by the state Antara news agency.

The firms, which were audited under an agreement with the International Monetary Fund, are Pelabuhan Indonesia II (port management), Jasa Marga (highway construction and maintenance), Perkebunan Nusantara IV (plantations), Garuda Indonesia (airline) and Telkom (domestic telecommunications).

Auditors defined inefficiencies as costs that should not have occurred or could have been avoided or revenue that might have been earned had the firms operated more efficiently.

They defined potential losses as future liabilities arising from inefficient operations or a lack of compliance with international best practices.

"These performance audits allow us to measure the gap that separates the state firms from international best practices so that we can aim for higher growth," State Enterprises Minister Laksamana Sukardi was quoted by the Post as saying on Thursday.

At Telkom examples of inefficient operations included high procurement costs, uncollected account receivables and unfavourable deals with several joint operation partners.

National flag carrier Garuda incurred losses partly from operating unprofitable routes, such as to the United States or Europe. These led to losses of 721 million dollars from 1995 to 1999.

Excessive government interference was noted in the operations of toll road operator Jasa Marga.