Finance Minister Sri Mulyani Indrawati and Trade Minister Mari Pangestu, two economists who have raised the profile of Indonesia, a Group of 20 (G20) member, kept their posts.
Another technocrat, Kuntoro Mangkusubroto, will head a new, presidential delivery unit to drive reform of the civil service, the judiciary and push through infrastructure projects.
The new unit, which some analysts say could be modelled on former British prime minister Tony Blair’s delivery unit, or the “West Wing” in Washington, could help improve coordination between the various ministries and resolve many of the bottlenecks holding back economic growth.
Yudhoyono, a reformist ex-general who was sworn in for a second, five-year term on Tuesday, announced a cabinet containing few surprises as most future ministers had been seen visiting the president in recent days to be interviewed for their jobs.
Indonesia, Southeast Asia’s biggest economy, is forecast to expand between 4 and 4.5 percent this year, and has lagged its larger rivals, China and India, for years in terms of growth and its ability to attract investment.
Clearing up corruption, red tape
Investors frequently cite corruption, red tape, legal uncertainty and shoddy infrastructure as the main deterrents to investment. Yudhoyono has promised to address these areas in his second term in order to turn Indonesia into a more attractive investment destination.
“Annual economic growth could hit 6 percent in the next five years but if the government has new policies in place such as ones regarding infrastructure, growth could even be higher,” said Purbaya Yudhi Sadewa, economist at Danareksa in Jakarta.
Analysts had welcomed the selection of key technocrats but expressed disappointment at some of the political selections, particularly of Darwin Saleh, the new energy and mining minister, who is relatively unknown and appears to have little experience of this important sector.
Fauzi Ichsan, senior economist at Standard Chartered Bank in Jakarta, said the credibility of Indrawati, Pangestu and Vice President Boediono should calm any market nerves.
“Their credibility should help ease worries over the capability of the new faces in the economic team,” said Ichsan.
Hatta Rajasa, one of the president’s trusted aides, was appointed Co-ordinating Minister for the Economy, while M.S. Hidayat, who heads the Indonesian Chamber of Commerce and Industry, will be Industry Minister.
Gita Wirjawan, a former banker at JP Morgan and Goldman Sachs, will head the Investment Co-ordinating Board with a mandate to attract more investment.
Sumber : Reuters
