IMPACT OF PRIVATIZATION

NEGATIVE IMPACT OF PRIVATIZATION State 

(STATE OWNED ENTERPRISES) 

IN INDONESIA

Indonesia as a country with the world's fifth largest population (230 million people) spread from Sabang to Merauke. With this huge population, forcing Indonesia to more extra hard trying to maximize resource-its resources to the welfare of society, one with the privatization efforts. The main issues that will be seen in this paper is whether the policy of privatization of state assets as a result of the political economy ofIndonesia to the welfare of society, or even endanger the community?

Privatization (According to Law No. 19 of 2003 on BUMN) is the sale of shares of Corporation (Corporation), either partially or wholly, to other parties in order to improve performance and company value, increase benefits for the state and the public, as well as expand the stock by the public. According to KH. M. Siddiqal-Jawi in his journal entitled Privatization : The Facts and danger of privatization mentioned that pose  hazards include : 1) a centralized asset on a few individuals or large corporations, 2) plunge the Islamic countries in the grip of economic imperialism, 3) Increase unemployment due to layoffs, and increased poverty due to the reduction of salaries, 4) the State will lose their sources of income,5) burdening consumers with inflated prices due to high tax onprivatized firms, 6) Block the people to take advantage of public ownership of assets

Implementation of the privatization is expected to create good corporate governance environment of state-owned enterprises as well as achieving good public governance in the public sector.Private roles are expected to be enhanced through the privatization of BUMN. Positive results are shown in the privatization, should be able to push the government to privatize, with due regard to the functions of government as regulator. Competitive business climate that can be anticipated by reducing the role of government that tends to be monopolistic public services can be provided more efficiently. However, privatization is the case even give the party an opportunity to enrich, enrich the already wealthy individuals, and even sometimes seem to sell the most part.