Indonesian President Joko Widodo yesterday announced a new Investment Ministry and the merger of two other ministries, in an effort to attract foreign investments and improve the ease of doing business in the country as it struggles to recover from the Covid-19 pandemic.
The Cabinet reshuffle, the second in four months, will see an upgrade of the bureaucratic status of the state agency, the Investment Coordinating Board (BKPM), to a ministry. The current BKPM chief Bahlil Lahadalia has been appointed Investment Minister.
The move will also see current Education and Culture Minister Nadiem Makarim taking on a larger portfolio, following the merger of his ministry and the Ministry of Research and Technology. The new ministry will be known as the Ministry of Education, Culture, Research and Technology.
Mr Widodo also appointed the Indonesian Institute of Sciences’ head, Dr Laksana Tri Handoko, as chief of the National Research Agency (BRIN) to oversee research and innovation.
BRIN, established in October 2019 at the start of Mr Widodo’s second term and currently under the Research and Technology Ministry, will become an independent body directly reporting to the President.
All three men were sworn in yesterday at the presidential palace in Jakarta.
The new Investment Ministry is expected to lure investments into the country and create jobs.
In a broadcast statement, Mr Bahlil said the ministry will be “a point to connect and synergise investments from outside and within the country, as well as from the central and regional governments, through a single door”.
“Holding back permits to carry out investments is akin to holding back national economic growth. It is the same as holding back jobs and sources of state income,” he added.
Mr Nadiem said that research and technology are “very close to my heart”, adding: “I have great hopes to improve the quality and innovation in our universities and higher-learning institutions in the field of research and technology”.
South-east Asia’s largest economy has been working to boost growth to around 5 per cent this year through direct investment, among other things. The government has introduced a slew of economic reforms to streamline overlapping and confusing regulations.
The Cabinet reshuffle is a president’s prerogative and can be carried out at any time, but usually around a year after a Cabinet is installed.
Ministers are evaluated, and then moved to more suitable posts or replaced if they have not performed well. The move was widely anticipated after the government-controlled House of Representatives approved the nomenclature changes to the ministries on April 9.
The latest reshuffle was relatively smaller than the first one held on Dec 22 last year, when a frustrated Mr Widodo replaced six ministers after months of berating his Cabinet’s abysmal handling of the Covid-19 pandemic.
Among the heads that rolled then were health minister Terawan Agus Putranto, a military doctor, who was replaced by Mr Budi Gunadi Sadikin, deputy stateowned enterprises minister.
Mr Budi, a 56-year old former banker who was chief executive of Bank Mandiri, Indonesia’s biggest state-owned bank, is known to possess strong management skills and has been involved in Indonesia’s lobbies to secure vaccines for its huge population.
Indonesia remains the country worst-hit by the pandemic in South-east Asia, with more than 1.6 million infections, and nearly 45,000 deaths.
• Additional reporting by Linda Yulisman