How SOEs Comply the Domestic Content Levels Requirement?

Summary

The government will determine domestic content levels (TKDN) for State-Owned Enterprises (SOEs). The Coordinating Minister for Maritime Affairs and Investment Luhut Pandjaitan, who is also the Chairperson of the National Team for Promoting the Use of Domestic Products (P3DN), said TKDN should be seriously addressed, especially for SOEs such as PT Pertamina (Persero) and PT PLN (Persero).

"The President has ordered that the budget and stimulus for the COVID-19 pandemic must use domestic products. I will ask the President for a Limited Meeting to discuss this matter so that we can identify our weaknesses. Officials who don't' implement TKDN will be substituted," Luhut said.

In addition to officials' removal, Luhut said SOEs directors would face sanctions for not complying with the 25 percent TKDN minimum requirement for goods and services expenditure. SOE Deputy Minister Budi Gunadi Sadikin proposed that the fines imposed on these SOEs should be raised from 5 percent to 25 percent of the value in the procurement contract.

Start your free trial.

If you would like to get a 30-day free unlimited access to all of our insights, please click “Start free trial” button below. If you already have an account, please login.

What do subscribers receive?

As a subscriber, you’ll receive daily insights, weekly business digests, and bimonthly industrial reports.

What kind of pieces will i get?

In-depth reports on assumption and impact analysis, as well as update and trends mapping, written by our credible and experienced analysts.

And, there is something else…

Enjoy a 30-day free trial, on us. Feel free to contact us with any additional questions you have.