Jokowi needs free hand to pick Cabinet, finance minister says

[JAKARTA] Indonesian President Joko Widodo has an ambitious list of goals for his next term - improving education and health care, providing a social safety net and developing infrastructure. What he needs, though, is the power to pick a team capable of helping him achieve them, according to Finance Minister Sri Mulyani Indrawati.

The 57-year-old, known as Jokowi, is set for a second five-year mandate with an official running tally of April's election showing him leading challenger Prabowo Subianto by about 12 percentage points. The president and his running mate, top cleric Ma'ruf Amin, need to accommodate the varied interests of 10 parties that make up their coalition while addressing a sizable current account deficit amid global uncertainties.

"He needs to have a free hand to decide what team he wants to choose in order for him to deliver, as well as to accelerate the development that he already initiated," Indrawati, a key member of Jokowi's Cabinet, said in an interview in Fiji where she was attending Asian Development Bank meetings. The official election result will be announced by May 22.

The former World Bank managing director told Bloomberg TV's Haslinda Amin that Jokowi may need to turn to the private sector to help with infrastructure development by providing mechanisms to attract investors. The president, she said, would also want to distribute wealth more evenly to lower the poverty rate to below 9 percent.

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The 2020 state budget draft will reflect Jokowi's increased focus on the development of human resources, the health sector, social security and infrastructure, Indrawati said.

Stability in Indonesia's leadership and governance would reassure its people and the international community, but there is still a need to be vigilant on the impact of much weaker-than-projected 2019 global economic growth, she said.

Revenue - both tax and non-tax - may fall short of this year's target because the price of oil will probably be lower than budgeted and commodity prices are softer due to the weakening global economy, Indrawati said.

Indrawati believes Indonesia should continue pursuing tax reform by improving compliance and educating the population about the importance of paying tax.

Jokowi is expected to take steps in next year's budget to boost investments and exports to stimulate the economy as external risks increase. The central bank is also considering easing measures to spur growth, allowing Indrawati room to provide incentives to the economy. The government is targeting a GDP expansion of 5.3 percent to 5.5 percent in 2020.

Foreign direct investment in Indonesia in the first three months of the year dropped for a fourth straight quarter as investors remained cautious before April elections. Investment fell 0.9 percent to 107.9 trillion rupiah ($7.6 billion) from a year earlier, undermining efforts to narrow the current account deficit, which widened to almost 3 percent of GDP last year.

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