Indonesia president appoints technocrats to top economic posts

[JAKARTA] Indonesian President Joko Widodo, also known as Jokowi, on Sunday assigned professional technocrats to lead the top economic ministries and implement much-needed reforms that address costly fuel subsidies, cooling investment and the country's creaky infrastructure.

Jokowi, who took office on Monday, unveiled his cabinet of 34 ministers that included former state-owned enterprises minister Sofyan Djalil as coordinating minister for economics, and promoted vice minister Bambang Brodjonegoro to be head of the finance ministry. "(Djalil) is an expert of economic strategy and finance and I trust him to be the captain at the helm of economic teams," Jokowi told reporters at a news conference where he announced his cabinet.

Djalil and Brodjonegoro take the helm at a time when Indonesia faces strong economic headwinds. Gross domestic product grew by 5.1 per cent on an annual basis in the second quarter, the slowest pace for five years.

Baradita Katoppo, Indonesia country head of Fitch Ratings, said the new key economic ministers "are experienced and have a good track record." Bambang Brojonegoro "knows exactly the fiscal problems in our country and knows what to do to improve the fiscal condition," Katoppo said. "Personally, I have high hopes in these ministers."

Indonesia's inadequate roads, ports, electricity and other basic services, along with its corruption and daunting bureaucracy, have begun to disenchant foreign investors, who are essential for the resource-based economy to grow.

At the same time, Indonesia's commodity-dominated exports have slumped and high interest rates are weighing are domestic consumption and investment.

One of the first decisions facing Jokowi and his cabinet is whether to press ahead with politically-sensitive rises in fuel prices, needed to slash costly subsidies.

The president named the chief executive of state-owned defence firm PT Pindad, Sudirman Said, as energy and mineral resources minister, and a former head of auto-assembler PT Astra International Rini Soemarno Soewandi as state-owned enterprises minister.

Retno Marsudi, the current ambassador to the Netherlands, becomes the first woman to be Indonesia's foreign minister.

Puan Maharani, a daughter of former president Megawati Sukarnoputri, was named coordinating minister for human development and culture.

Jokowi, who is popular for his clean image, sought to ensure the credibility of his cabinet by taking the unprecedented step of having the country's main anti-graft agency vet each candidate.

The Corruption Eradication Commission last week rejected eight of Jokowi's initial cabinet due to graft concerns, forcing the president to delay his announcement and find last-minute replacements. "The process of defining the ministers was done carefully and cautiously as this is a priority," Jokowi said. "The cabinet will be working for five years and we want to get the clean ones ... because we want to be accurate and right," he said.

REUTERS