Top Candidates for Replacement of Sri Mulyani

Anny Ratnawati, the finance ministry’s Director General of Budgeting, and Armida Alisjahbana, State Minister for Development Planning, are considered strong candidates for the post, partly because President Susilo Bambang Yudhoyono is expected to favour maintaining the female “quota” in his male-dominated cabinet.

Outgoing Finance Minister Sri Mulyani Indrawati, who takes up a new post at the World Bank on June 1, was a leading reformer in the Yudhoyono government. But while Ratnawati and Alisjahbana are experienced, respected economists, neither is associated with the reform drive.

“They are both very good in terms of macroeconomic credentials,” said Purbaya Yudhi Sadewa, an economist at the Jakarta-based Danareksa Research Institute, adding that whoever is appointed will need to be tough in one of the world’s most corrupt countries.

Indrawati was one of four female ministers in the cabinet and Yudhoyono is likely to want to retain that mix, his former Vice President Jusuf Kalla said recently. However, Yudhoyono’s spokesman Julian Aldrin Pasha was quoted by Antara news agency on Tuesday saying the president had already made his choice and discussed it with coalition partners but would not say when the appointment would be announced.

“The figure is not a new face and is widely known by both the public and the market,” he said. While both women have a high domestic profile, they are not well-known internationally.

Ratnawati

Ratnawati, 48, is a former university lecturer with a masters in agribusiness and a doctorate in agricultural economics. She is seen as a fiscal policy expert with close ties to Yudhoyono, especially since she worked for him as a speechwriter and economic adviser during his first presidential
bid in 2004.

She has worked as a technical adviser at the finance ministry for five years and was promoted to a position as director general of budgeting at the finance ministry two years ago. Ratnawati is also a commissioner at state oil firm Pertamina, which some analysts see as a potential conflict of
interest, at a time when Indonesia is supposed to be phasing out the custom of appointing civil servants to the boards of state firms.

Ratnawati has no obvious political baggage, but Golkar — the old guard political party that lobbied to have Indrawati removed and her reform agenda weakened — has recently been promoting Ratnawati, as well as Indrawati’s deputy, Anggito Abimanyu, as good replacements for Indrawati. That apparent endorsement has raised concerns among some analysts about their possible commitment to reform.

The feisty Indrawati earned powerful enemies by pushing difficult reforms aimed at boosting tax collection, promoting meritocracy in the civil service, and curbing graft. Little is known about Ratnawati’s stance on continuing painful reforms such as energy subsidy cuts or electricity tariff increases, but Sadewa said her experience in the rough world of Indonesian politics complemented her economic credentials.

“Ratnawati has been doing this for some time. She has experienced robust discussion in parliament,” he told Reuters.

Alisjahbana

Alisjahbana, 49, also has a strong CV but less experience when it comes to dealing with politicians. “Armida is a new player. Before, she was a lecturer and I am not sure she is that strong in the sense of her ability to deal with the parliament,” Sadewa said, adding that she was seen as having integrity.

Alisjahbana has a PhD in Economics from the University of Washington, and wrote her thesis on economics and education. She also has a Masters in Economics from Northwestern University, Illinois and an undergraduate degree from the University of Indonesia, where she specialised in tariff barriers in the domestic manufacturing sector.

She graduated from the University of Indonesia a year ahead of fellow student Indrawati, who also moved into the finance ministry position from state planning ministry Bappenas. Before becoming a minister, Alisjahbana was an academic and adviser to the World Bank, specialising in Indonesian labour issues. She also advised the finance ministry on tax and fiscal decentralisation, a topic on which she is seen as a specialist.