FAR more frequently than it deserves, Indonesia attracts bad press. Admittedly, Jakarta’s traffic jams are horrendous, roads outside Java, particularly in Kalimantan and Sulawesi, require billion-dollar improvements while the trans-boundary haze that almost annually wafts across to this country lasts for weeks although in recent years less severely.
Often overlooked are some significant positives. Indubitably, Indonesia’s biggest asset is its Finance Minister Sri Mulyani Indrawati. With a doctorate in economics from the University of Illinois, the 57-year-old Mulyani has served as finance minister to two presidents – from 2005 to 2010 under the then president Susilo Bambang Yudhoyono (SBY) and from July 2016 under President Joko Widodo, popularly known as Jokowi.
During both stints as finance minister, Mulyani has been frequently lauded. In 2006, she was named the world’s best finance minister by Euromoney.
Last February, she received the Best Minister Award at the World Government Summit. All nominees are assessed independently by global consulting firm Ernst & Young and judged on their success in implementing reform in their home countries.
Additionally, FinanceAsia named her Best Finance Minister in 2017, 2018 and 2019. Mulyani succeeded in leading Indonesia’s economy towards a more positive path, adding that in 2018, Indonesia’s budget deficit was 1.76% of Gross Domestic Product (GDP), the lowest in six years, FinanceAsia said.
GDP is the total value of goods and services produced within a country in a single quarter or year.
Through the Tax Amnesty from 2016 to 2017, the rate of tax compliance increased while improving tax revenue. Additionally, Mulyani encouraged Indonesia to be the first Asian country to issue green bonds. Totalling US$1.25 billion, the bond is specifically earmarked for projects relating to the climate and environment, FinanceAsia noted.
Even more remarkable, in securing the 2019 FinanceAsia award, Mulyani relegated to second place the Philippines’ Finance Minister Carlos Dominquez and to third place Singapore’s Heng Swee Keat.
Last year, Mulyani was also named as Finance Minister of the Year Global and the Asia Pacific by The Banker, a magazine affiliated with the Financial Times.
Mulyani is widely admired because of her consistent and persistent tough stance against corruption.
When she first became finance minister under SBY, Mulyani sacked 150 of her departmental staff for corruption and penalised another 2,000, World Finance wrote.
“If you are corrupt, you are going to have to deal with me. I am not going to let you work here and I will put you in prison; that’s going to be my policy,” she told an interviewer in 2009.
In another instance, when Mulyani couldn’t identify those in the government’s human resource department who were accused of manipulating the rotation for promotions, she told the director-general to replace all 60 employees in that cohort, World Finance wrote.
“Overkill is necessary and important to get the message across,” she said when asked about this decision.
Within Indonesia, Mulyani’s tough stance against corruption incurred the enmity of powerful businessmen, some of whom were also major political players.
One example was the imbroglio over the US$700 million bailout of PT Bank Century. Critics claimed this bailout was implemented without legal authority. Mulyani denied any criminal wrongdoing and testified in the Indonesian Legislature. One day later, on May 5, 2010, SBY announced Mulyani was resigning to become one of three managing directors at the World Bank.
US-based Brookings Institution’s Lex Rieffe described Mulyani’s resignation in these words: “Indonesia’s loss is the World Bank’s gain. Or maybe it’s the world’s gain because this new position in the World Bank could be a stepping stone to a more responsible position in the international financial community.”
One indicator of Mulyani’s success: Reducing Indonesia’s public and private debt. “By 2009, the nation’s debts had been reduced to 30% of over GDP, down from over 100% a decade earlier,” World Finance wrote.
Mulyani is also a forthright person. At a teleconferenced media briefing on April 1, she warned the Indonesian currency could hover around 17,500 rupiah to the US dollar or even slide to as low as 20,000 rupiah – the latter is a record low surpassing the 16,950 rupiah-US dollar exchange rate during the 1998 Asian Financial Crisis.
At press time, the exchange rate was 16,204 rupiah to the US dollar.
Acknowledging the 20,000 rupiah level is the worst case scenario, Mulyani pledged to take measures to prevent this from materialising.
Last Monday, Indonesia racked up another first – raising a US$4.3 billion bond, its first “pandemic” bond. Not only was this Indonesia’s largest bond deal, it was the first time a 50-year US dollar bond had been issued in Asia, Reuters noted.
In photos, Mulyani appears impeccably dressed, usually in Indonesian batik without colourful sequins or sparkling beads.
During the Covid-19 pandemic, arguably the world’s worst health crisis, Finance Minister Sri Mulyani Indrawati is Indonesia’s strongest weapon against an impending financial recession.
Opinions expressed in this article are the personal views of the writer and should not be attributed to any organisation she is connected with. She can be contacted at siokchoo@thesundaily.com
