Update Cabinet Reshuffle Indonesia: Who Are the New Ministers?

The following changes were made to Widodo's cabinet:

• Sri Mulyani Indrawati replaces Bambang Brodjonegoro as Finance Minister
• Wiranto replaces Luhut Binsar Pandjaitan as Chief Security Minister
• Archandra Tahar replaces Sudirman Said as Energy and Mineral Resources Minister
• Budi Karya Sumadi replaces Ignasius Jonan as Transportion Minister
• Airlangga Hartarto replaces Saleh Husin as Industry Minister
• Muhajir Effendi replaces Anies Baswedan as Education Minister
• Eko Putro Sanjoyo replaces Marwan Jafar as Villages, Disadvantaged Regions & Transmigration Minister
• Asman Abnur replaces Yuddy Chrisnandi as Administrative and Bureaucratic Reform Minister
• Enggartiasto Lukita replaces Thomas Lembong as Trade Minister
• Thomas Lembong replaces Franky Sibarani as BKPM Head
• Bambang Brodjonegoro becomes Head of the National Development Planning Agency (Bappenas)

President Widodo decided to rigorously change the composition of his cabinet (his first cabinet reshuffle - in August 2015 - 'only' involved six changes) in a bid to boost effectiveness of his "Working Cabinet" (in Indonesian: Kabinet Kerja) cabinet.

Two names stand out particularly: Sri Mulyani Indrawati and Wiranto (who - like many Indonesians - goes by one name).

Sri Mulyani Indrawati was Indonesia's finance minister from 2005 to 2010 under former president Susilo Bambang Yudhoyono. Sri Mulyani is known as a reform-minded technocrat and this is what most likely ended her political career in 2010 when she clashed with political forces that have major business interests (most notably Golkar's Aburizal Bakrie). Sri Mulyani and former vice president Boediono were criticized for mishandling a bank bailout case in 2008 (the famous Bank Century case). Due to pressures she moved to the World Bank Group in 2010 where she started to work as a managing director.

Markets must be pleased to see Sri Mulyani return to Indonesia as she enjoys popular support due to her reform-mindedness. Today President Widodo announced that she has replaced Bambang Brodjonegoro as finance minister, possibly related to weak government revenue in the first half of 2016 (primarily due to weak tax collection).

Wiranto is a controversial choice that may evoke international criticism but could enjoy domestic support. This former army general is linked to human rights abuses in East Timor in 1999 when he headed the armed forces. After the people of East Timor decided to break away from Indonesia in a referendum, the Indonesian army went on a killing spree. Although Wiranto has been accused of human rights abuses, he has always denied such claims and has never faced court. Today, President Widodo confirmed that Wiranto replaces Luhut Binsar Pandjaitan as Indonesia's Chief Security Minister

However, Wiranto may enjoy domestic support as he is regarded a strong (New Order-trained) leader. Given that China is eager to expand its influence in the South China Sea, occasionally breaching the territorial sovereignty of ASEAN member nations (including Indonesia, near the Natuna Islands), Indonesians may be content to see a strong leader as Indonesia's top Security Minister. This controversial choice of Widodo could in fact be a sign to both the international community and Indonesian people that he seeks a tougher stance in terms of national security. It also shows that the handling of human rights abuses is not the top priority on Widodo's agenda (later this week Indonesia is set to execute several convicted foreign drug traffickers).

This article was written by R.M.A van der Schaar, the Managing Director of Indonesia Investments. He obtained his Masters degree in Southeast Asian Studies from Leiden University (the Netherlands) with a major focus on the society, history and linguistics of Indonesia.

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