Jakarta. President Prabowo Subianto has allowed foreigners to take leadership roles at Indonesia’s state-run enterprises, especially if they are up to the job.

Speaking in front of top businessmen from home and abroad, Prabowo said that he had instructed the sovereign wealth fund Danantara to make sure that all state-owned enterprises (SOEs) meet “international standards”. This agency, which is now about 7 months old, has taken at least 1,000 SOEs under its management.

“You [Danantara] can look for the best brains and best talents. I have changed the regulations,” Prabowo told the Forbes Global CEO Conference in Jakarta on Wednesday evening.

“Expatriates and non-Indonesians can now lead our SOEs,” Prabowo said.

Earlier that day, two expatriates had joined the national airline Garuda Indonesia’s top brass in a major board shake-up. Balagopal Kunduvara, a former executive at Singapore Airlines, officially became Garuda’s chief financial officer. Kunduvara spent over 25 years in the Singaporean flag carrier. Seasoned aviation professional Neil Raymond Mills, who was once the president and chief operating officer of the Nigerian low-cost airline Green Africa Airways, also got picked as the new director of transformation. Mills also used to be the chief procurement officer at Scandinavian Airlines.

Danantara’s boss Rosan Roeslani told the press that Garuda, which had been in the red, needed someone of Kunduvara’s caliber. He also brought up how Garuda had taken up a $405 million shareholder loan from Danantara, thereby the need to make sure that the company can bounce back.

“We have long been trying to recover Garuda, … but we haven’t had the best results. … We don’t want to be careless. What’s most important is to have someone who not only has great plans but can execute their goals quickly,” Rosan said.

Danantara’s chief investment officer Pandu Sjahrir defended the plan, although he explained that the foreign professionals would be the last option for leadership roles in case Indonesian nationals or diasporas did not tick all the boxes.

“There is a wish to turn our SOEs into global champions, … this is a dream that requires human capital. But our priorities remain the same: we will look for the best talents at home, as well as the Indonesian diaspora,” Pandu said.

“If there is none, we will try to look for international people.” 

Amidst Garuda’s board reorganization, Indonesia is trying to drastically cut the number of its SOEs to boost the return on assets. Prabowo said that he wanted to see it down from the current 1,000 to a “more rational figure” of between 230 and 240 companies. Danantara is currently exploring some merger plans, including one involving Garuda Indonesia and Pertamina’s airline subsidiary Pelita Air.

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