Indonesia’s Deputy Speaker denies Finance Minister Sri Mulyani stepping down

JAKARTA – Indonesia denied that veteran Finance Minister Sri Mulyani Indrawati is resigning, moving to calm investors after the biggest slump in stocks in more than a decade.

“I assure you that Sri Mulyani is not stepping down and our fiscal position is strong,” Indonesia Parliament Deputy Speaker Sufmi Dasco Ahmad said, as officials held a briefing at the stock exchange on March 18.

Mr Dasco, a senior politician in President Prabowo Subianto’s Gerindra party, was responding to questions on whether the stocks decline was due to rumours of Dr Sri Mulyani’s departure.

The benchmark index slumped by as much as 7.1 per cent, the most since 2011, before paring its losses to 3.8 per cent after the government’s denials.

Dr Sri Mulyani continues her duties and responsibilities as finance minister, Presidential Communications Office spokesman Hariqo Wibawa Satria said in a video address posted on Instagram late on March 17.

“The information circulating about Sri Mulyani Indrawati’s resignation as Minister of Finance is a hoax.”

Stocks plunged on March 18

and Bank Indonesia intervened to support the rupiah amid rumours in local newspapers and social media that Mr Prabowo plans a Cabinet shake-up that could include Dr Sri Mulyani, who has helmed Indonesia’s finance ministry for 14 of the last 20 years.

Dr Sri Mulyani has been credited with steering South-east Asia’s largest economy through the turmoil spurred by the Covid-19 pandemic, embarking on an unprecedented debt monetisation with the central bank to fund stimulus spending.

Her commitment to fiscal prudence was made evident when the government managed to return the budget deficit below the legal limit of 3 per cent of gross domestic product by end-2022, a year earlier than promised.

She also pushed for tax and budget reforms that helped the country earn two upgrades to an investment-grade debt rating with S&P Global Ratings during her watch. BLOOMBERG