As part of efforts to drive efficiency into Indonesia’s state-owned enterprises (SOEs) while specifically attempting to boost its aviation and tourism sectors, President Joko Widodo has approved a plan to put seven such enterprises, including flag carrier Garuda Indonesia (GA, Jakarta Soekarno-Hatta) and their subsidiaries, under a new holding entity, local media reported.

Under the plan, Survai Udara Penas (PNS, Jakarta Halim), a hitherto dormant fully state-owned operator whose AOC was revoked in 2015, will be resurrected to become the new holding company.

Besides Garuda Indonesia, the SOEs are the airport operators Angkasa Pura I and Angkasa Pura II, air navigation firm AirNav, hotel operator Hotel Indonesia Group, retailer Sarinah, and entertainment complex operators Indonesia Tourism Development Corporation and Taman Wisata Candi Borobudur Prambanan Ratu Boko.

“The holding company will improve the climate of the aviation and tourism industry,” explained Erick Thohir, minister of state-owned enterprises, in a meeting broadcast virtually on YouTube after the president gave his blessing to the plan on November 27.

It will help spearhead the recovery of travel and tourism after it was severely impacted by the Covid-19 pandemic, he said, and it will help to address the uneven distribution of domestic air traffic, which is still concentrated in the country’s central and western regions.

Crucially, the holding’s aviation and tourism activities will open up to involve private companies, the minister said.

“We don’t want ivory towers, so the private sector will be involved. We are exploring cooperation with many parties,” he added. “This holding will improve the climate for the aviation and tourism industry so that it has an optimal impact on the country.”

Survai Udara Penas will ensure that international routes and investment are spread evenly across the archipelago and “will arrange airports and flight routes to improve connectivity and encourage the growth of the tourism sector with the aim of equitable distribution of economic growth and improving the quality of public services,” Thohir outlined.

Penas has continued to operate as a company, based at Jakarta Halim Airport and providing weather survey, mapping, aircraft rental services, and an air ambulance, according to the news site Tempo. In April 2019, Gatot Trihargo, then a state finance official, told the business news site Katadata that Penas had been chosen and groomed for its future role as a “special company” specifically because it was a small state-owned firm with a low level of complexity compared to other SOEs.