The Strait Times: Sri Mulyani: World’s gain, Jakarta’s loss

Indonesia never deserved finance minister Sri Mulyani Indrawati. Precious few Indonesians, especially among the political class, seem capable of distinguishing good from bad, reformer from rent-seeker. When she resigned this week to become one of the three World Bank managing directors, it was not only a loss for President Susilo Bambang Yudhoyono and his government, but for the nation as a whole. Perversely, having an Indonesian at the pinnacle of a major financial institution is a feather in the cap for the country, particularly someone who kept Indonesia growing through the recent global economic crisis.

Indeed, United States President Barack Obama is widely rumoured to favour the 47-year-old

Sri Mulyani Indrawati

former International Monetary Fund (IMF) official as the first non-American to take over the post of World Bank president. If that is true, then Dr Sri Mulyani will be in line to replace the incumbent Robert Zoellick at the end of his five-year term in 2012.

Still, outsiders must be puzzling over how one of Indonesia’s most able and reform-minded technocrats could have been reduced to such a liability that her move to the World Bank is now seen as a convenient solution to an intractable political problem. Left swinging in the wind in the wake of the Bank Century bailout, the target of vested business interests and unprincipled politicians, it is little wonder she has tossed in the towel.

Sri Mulyani at the G20 Summit in Pittsburgh

Some Indonesian observers want to dismiss it all as politics, but that is just too easy considering the President’s failure to protect his most valuable minister and the venal nature of the anti-reform forces that were aligned against her from the start. No matter what the circumstances, the President will now be seen to have bowed to the pressure exerted by Golkar Party chairman Aburizal Bakrie, the businessman- political financier whose companies still owe the government more than US$200 million in unpaid taxes.

“It is too convenient for everyone,” says one foreign banker who observed Dr Sri Mulyani’s moods swing from mortification that she could have done anything unethical to her almost cocky demeanour during the bailout hearings – and finally to the more recent state of sad resignation. In the aftermath of her resignation, Golkar politicians accused her of behaving unethically and called on the government to stop her from leaving the country until the anti-corruption commission finishes what is almost certainly a pro-forma investigation. Given the failure of the recent parliamentary inquiry to lay a legal glove on the embattled minister, and the World Bank’s clear vote of confidence in her integrity, Golkar’s outburst almost defied belief.

The Indonesian media has a lot to answer for, bleating about press freedom but unable to act

World Bank's logo

responsibly and objectively – or to shake off the belief that no one in government can be trusted to do the right thing. While that may be a legacy of the Suharto years, one cannot ignore the growing editorial influence of media owners, many of whom have contributed to the political polarisation that has undermined Dr Yudhoyono’s coalition.

International finance officials say that while Indonesia will no doubt come up with a suitable replacement to manage the economy, it will be a lot more difficult to find someone who is as willing to take on the tough task of bureaucratic reform as was Dr Sri Mulyani.According to insiders, she was first offered the World Bank job when she was in the US last September for the Group of 20 (G-20) summit – but that was before she was forced to hurry home to deal with the Bank Century bailout. She is said to have first raised the subject with the President a month or more ago, apparently worn out by unrelenting parliamentary sniping over what to her was a well-intentioned, though ultimately flawed, policy decision that the President himself had signed off on. But it was not until the April 19-21 economic conference in Bali, which Dr Sri Mulyani had to leave early to attend an IMF-World Bank meeting in Washington, that she pressed him on what she should do. When he said nothing, she took his silence as the signal to accept the offer.

World Bank Headquarter in Washington DC

“It was like an avalanche waiting to happen,” says one government official. “But you can make up your own mind on whether she jumped or whether she was pushed.” The President later claimed he gave her the go-ahead immediately after receiving a letter from Zoellick on April 30, but that hardly explains the shabby public relations snafu that attended the announcement.Even as Indonesians learnt of the appointment on the World Bank’s website, presidential spokesman Julian Pasha confessed he knew nothing about it. Dr Sri Mulyani’s fellow economic ministers were also caught off guard by the bombshell. Some were aware, however, of her very human personal concerns, shared by other incorruptible officials, about giving her children a decent schooling – presumably outside a country whose education system is appalling.

The minister’s current base salary is a ridiculous US$2,000 a month. In her new job, as managing director for Latin America, the Caribbean, the Middle East, North Africa, Asia and the Pacific, she will be pulling in an annual US$488,300 – tax free. “Personally, I think she is doing this for her family,” says one finance ministry source, referring to her two teenage sons and a daughter attending Monash University in Australia. “The toll on them has been far too high.”(05082010/IM)

Digg This
Reddit This
Stumble Now!
Buzz This
Vote on DZone
Share on Facebook
Bookmark this on Delicious
Kick It on
Shout it
Share on LinkedIn
Bookmark this on Technorati
Post on Twitter
Google Buzz (aka. Google Reader)

Leave a Reply

Your email address will not be published. Required fields are marked *