JAKARTA, Aug 12 — Indonesian President Joko Widodo will replace key economy ministers in a cabinet reshuffle today, sources said, a long-expected change to reassure investors worried about a policy drift that has allowed growth to slip to a six-year low.
According to media reports and Reuters sources, former central bank governor Darmin Nasution will replace Sofyan Djalil as chief economic minister and prominent private equity executive Tom Lembong will take over the trade portfolio.
Nasution, 66, was Bank Indonesia governor from 2010 to 2013 and is widely respected in the business community.
Thomas T. Lembong, a Harvard-educated investment banker, is the chief executive of Quvat Management, a Singapore-based private equity firm that invests in Indonesia.
The president’s office declined to comment, saying an announcement would be made later in the day.
Indonesia’s gross domestic product grew at 4.67 per cent in the second quarter, its slowest pace in six years.
Since he took office last October, Widodo’s government has passed a raft of measures aimed at boosting industry and consumption that have been criticised by investors as protectionist.
A source familiar with Widodo’s plan said the president is keen to dispel an impression that his leadership is weak and policy muddled.
By appointing ministers with international experience and an external focus he may address concerns that his government too readily resorts to protectionism and is not wholly committed to nurturing foreign investment, the source said.
“The emphasis of the reshuffle is on better balance - especially in the economic team - between age, experience, international exposure and language skills,” the source said.
At least four other ministers are set to be replaced, including the cabinet secretary and chief security minister, according to sources.
In a sign of Widodo’s growing independence from his political patrons, he will accommodate only one additional political appointee from his own party, while the rest of the replacements will be technocrats.
Widodo has faced severe public criticism over his perceived failure to stand up to vested interests and the demands of his party’s chief, former President Megawati Sukarnoputri, who backed him in last year’s election. — Reuters