Jakarta. Indonesia’s sovereign wealth fund Danantara is targeting consolidated profits of Rp360 trillion ($20.2 billion) from state-owned enterprises (SOEs) in 2026, as it pushes ahead with a sweeping consolidation and business transformation program aimed at improving efficiency and competitiveness.

Dony Oskaria, Danantara’s chief operating officer and head of the State-Owned Enterprises Regulatory Agency (BP BUMN), said the restructuring was intended to strengthen the financial performance of state companies and counter perceptions that SOEs are unable to generate significant profits.

“After the consolidation, we will improve the businesses. So we hope to record Rp360 trillion in profit this year,” Dony said at the Investor Daily Policy and Economic Dialogue in Jakarta on Wednesday.

Dony said consolidation and transformation were essential to improving the overall condition of state-owned companies, allowing them to operate more efficiently, compete more effectively and make a larger contribution to the national economy.

The restructuring includes a streamlining program designed to reduce the number of SOEs and eliminate inefficient businesses.

Some 290 companies have so far undergone the streamlining process, while around 300 more are targeted for completion by the end of 2026, Dony said.

The government expects the restructuring to generate substantial savings by eliminating loss-making companies and reducing inefficiencies in business relationships between parent companies and their subsidiaries.

Companies that have been closed were previously recording combined losses of around Rp20 trillion a year. Their closure is expected to generate savings of a similar amount.

Another Rp30 trillion in efficiency gains is expected from addressing inefficient business relationships between companies that were subsequently closed and their parent companies.

Together, the reduction in losses and improvements in intercompany business arrangements are expected to generate about Rp50 trillion in savings.

Further savings of around Rp15 trillion are expected from reductions in salaries, board fees and other benefits for commissioners and directors at the companies affected by the restructuring.

Overall, the government expects the SOE streamlining program to generate more than Rp70 trillion in efficiency gains by the end of 2026.

The restructuring is part of the government’s broader effort to consolidate Indonesia’s large state-owned enterprise sector and improve the companies’ contribution to economic growth.

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