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Politics will influence finance minister search: Analysts

Source
Jakarta Globe - May 10, 2010

Armando Siahaan – Senior members of both the Democratic Party and Golkar Party have consistently denied that their relationship in the ruling coalition would affect the selection of a new finance minister to replace Sri Mulyani Indrawati, but political analysts say Democrats may use the opportunity to make a fence-mending concession.

"The issue of Sri Mulyani's replacement should not be intertwined with the establishment of the joint secretariat [for the ruling coalition]," Democrat secretary general Amir Syamsuddin said, adding that the president has stated that the replacement will be someone with a professional background, not a political one.

Priyo Budi Santoso, the deputy House speaker from Golkar, has also denied claims the party would actively push forward its preferred candidates, especially with party chairman Aburizal Bakrie as the managing chairman of the coalition's new joint secretariat. "We would leave it to the president. It's up to him," he said.

But Aburizal's problems with reformer Sri Mulyani have been no secret, and speculation has been rife that Golkar's main objective in its aggressive stance in the Bank Century scandal was to push out the finance minister.

Burhanuddin Muhtadi, a political analyst from the Indonesian Survey Institute, said President Susilo Bambang Yudhoyono would likely capitalize on Sri Mulyani's resignation as a way to consolidate the ruling coalition that was fractured during the Bank Century bailout case, meaning he would likely try to accommodate Golkar's nomination.

He said Yudhoyono would most likely appoint Anggito Abimanyu, the head of the Finance Mnistry's fiscal policy agency since 2006 who is known for his ties with Golkar elites, including Aburizal.

In the past, Anggito was widely regarded as a strong contender for the post of finance minister. He is known to foreign investors and policy makers, and while he has a lower profile internationally, he is considered likely to continue with many of the same policies instituted by Sri Mulyani.

However, Burhanuddin said Anggito was slightly less qualified than the other strong candidate, Darmin Nasution, the current acting governor of Bank Indonesia.

Anggito has held a number of posts within the Finance Ministry and has been the head of the ministry's fiscal policy agency since 2006. He was a member of the board of commissioners of PT Telekomunikasi Indonesia (Telkom) from March 2004 to July 2008. At one point, he was also a board member of Lippo Bank and Bank Internasional Indonesia.

Darmin has held a number of senior posts in the government, including in the central bank, tax office and the Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK).

He showed a reformist streak while director general of taxation from 2006 to 2009, working under Sri Mulyani. Darmin started in that post after Sri Mulyani removed then-tax chief Hadi Purnomo in a bid to reform the office.

In 2008, the tax office under Darmin collected Rp 624 trillion ($68 billion), more then double the Rp 280 trillion taken in 2006, Hadi's last year in the office. Many analysts have said the increase in revenue was largely due to the tax office's tougher stance against cheats. "Unfortunately, Darmin has no political backing," Burhanuddin said.

Sunny Tanuwidjaja, from the Center for Strategic and International Studies, said that though Golkar might try to assert itself, President Susilo Bambang Yudhoyono's appointment of Sri Mulyani's replacement would be mostly independent.

"As a president who won the election with 60 percent of the vote, he will not be dictated to by external voices, although he will consider input from others," Sunny said.

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