May 5, 2010

Indonesia’s Loss, the World Bank’s Gain

It might be that only a Divine intervention has made this "solution" possible... way, way beyond our limited sphere of thoughts. This is in spite of us having to let go of someone with this calibre & courage. Surely, such character will bring about a lot more use (and become a blessing) to the greater people out there stamping out poverty in three huge regional parts of the world.  (EJ) 

Finance Minister Sri Mulyani Indrawati to be World Bank

Finance Minister Sri Mulyani Indrawati to be World Bank's managing director (EPA Photo)

Editorial: Indonesia's Loss, the World Bank's Gain

5-May-2010  Finance Minister Sri Mulyani Indrawati's appointment as managing director of the World Bank is Indonesia's loss and the World Bank's gain. A fearless reformer and highly respected economist, Sri Mulyani has been a central member of President Susilo Bambang Yudhoyono's cabinet for the past five years.

She has been largely responsible for putting in place the macro-economic fundamentals that have allowed Indonesia to outperform other regional economies in recent years. Under her stewardship, Indonesia was one of only a handful of countries that registered positive growth during the financial crisis of 2008 and 2009.

More importantly the outlook for the Indonesian economy looks extremely positive, which is one reason why the Indonesian stock market and the rupiah performed so well in the first quarter of 2010. With her new appointment, there will be concerns about whether her successor can manage the ship just as expertly.

But perhaps Sri Mulyani's lasting legacy will be her courage to take on an entrenched bureaucracy within the Ministry of Finance by introducing sweeping reforms. She bravely closed down the customs department to stop widespread corruption in the nation's ports, a move that earned her respect and derision in equal measure.

Just this week, she has vowed to go after tax officials and major tax dodgers in another attempt to sweep the Directorate of Taxation clean after recent high profile corruption cases involving the department. In this regard, her successor will have huge shoes to fill and it remains to be seen whether he or she will posses the same iron will as the outgoing minister.

But given her fraught relationship with the House of Representatives over the Bank Century scandal, perhaps her appointment is the best face saving outcome for all sides: politicians, the president and Sri Mulyani herself. Her appointment to the second most senior job at the World Bank will definitely lift Indonesia's reputation on the global stage but her drive, intelligence and courage will be missed at home.

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