Indonesian President Susilo Bambang Yudhoyono starts a second five-year term today with a mandate to speed growth in Southeast Asia's biggest economy. To do that, he must reconcile national and local policies, analysts say.

"Many targets couldn't be reached because of bottlenecks," Yudhoyono said earlier this month. The goal in the second term "is very clear," he said. "Solve these clogs. That's why we will reform bureaucracy, rearrange permits, control programs, and prevent incorrect practices."

Yudhoyono won the July 8 election on pledges to end corruption and rein in terrorism. A July 17 suicide attack on two Jakarta luxury hotels was the country's first in almost four years, and anti-terror squads killed most-wanted terrorist Noordin Mohammad Top last month. The president still must build roads, power plants and ports vital for growth, said Umar Juoro, of Jakarta-based Center for Information and Development Studies.

"The strength of Yudhoyono's economic team has been in the macro level," Juoro, who is also a commissioner at PT Bank Internasional Indonesia Tbk, said in an Oct. 19 phone interview. "When we see the results in the real sector like mining, agriculture and infrastructure, we will find many policies that didn't run properly."

While Indonesia made more key changes in easing business regulations than other East Asian and Pacific economies, as the World Bank's 2010 "Doing Business Report" showed last month, a number of regional laws contradict national policies, creating legal uncertainty for investors, said Chris Kanter, vice president of the Indonesian Chamber of Commerce and Industry.

Yudhoyono's next cabinet will be a combination of professionals and members of the five parties that have joined his Democrat Party in the ruling coalition. The latter group doesn't represent "something the markets will be cheering over," said Helmi Arman, an economist at PT Bank Danamon Indonesia Tbk in Jakarta, in an Oct. 19 E-mail.

"Partisan politics apparently still played a significant role in the assignment of other key ministerial posts," Arman said. The president has "the added burden" of ensuring a consolidated agenda and "making sure that partisan cabinet ministers don't go their separate ways," he said.

Yudhoyono has told candidates for his next cabinet, which may be announced tomorrow, they should make Indonesia investment-friendly.