Indonesian regional governments optimize BUMD assets to boost local income

Regional governments in Indonesia are focusing on optimizing Regional Owned Enterprises (BUMD) and local assets to boost Regional Original Income (PAD).

In North Sumatra, Vice Governor Surya presented a strategy to the DPR RI Commission II involving the acceleration of asset certification, inventory, and digitalization. The goal is to minimize legal disputes and transform regional assets into productive economic drivers through business transformations and strict monitoring of BUMD performance.

In East Java, the PDIP fraction of the Regional House of Representatives (DPRD) has called for a comprehensive evaluation of BUMD performance. Legislators emphasized that evaluations should go beyond simple profit and loss statements, instead measuring the efficiency of regional capital through indicators such as Return on Equity (ROE) and Return on Assets (ROA). This follows reports that a significant portion of East Java's PAD contribution comes from Bank Jatim, prompting calls to ensure that subsidiary companies do not become financial burdens to their parent entities.