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Jokowi’s Cabinet Is a Blend of Politicians, Tycoons, and Technocrats

Arys Aditya and Viriya Singgih
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Jokowi’s Cabinet Is a Blend of Politicians, Tycoons, and Technocrats

(Bloomberg) -- Indonesian President Joko Widodo named a millennial startup founder as the new education minister and tapped his election rival to head the defense ministry as he strengthens his grip on power and looks to bolster Southeast Asia’s largest economy against a global slowdown.

Sri Mulyani Indrawati, a veteran finance minister, was reappointed to the post, while Prabowo Subianto, Widodo’s challenger in the 2019 and 2014 elections, got the defense ministry as the president expanded the coalition of parties backing his government to almost 75% of the seats in the parliament. Nadiem Makarim, the 35-year-old co-founder of ride-hailing service Gojek was named as the minister for education.

Jokowi, as the president is known, on Wednesday introduced his new cabinet team at the state palace in Jakarta and urged them to shun corruption and work faster to find solutions for problems plaguing the world’s fourth most populous nation.

Here is a list of the key cabinet members and their posts:

Airlangga Hartarto - Coordinating Minister for EconomyMahfud MD - Coordinating Minister for Political, Legal and Security AffairsLuhut Pandjaitan - Coordinating Minister for Maritime Affairs and InvestmentSri Mulyani Indrawati - FinancePrabowo Subianto - DefenseRetno Marsudi - ForeignNadiem Makarim - Education and CultureAgus Gumiwang Kartasasmita - IndustryAgus Suparmanto - Trade

For Jokowi, finalizing the makeup of the cabinet may have been the easy part. Now he has to make good on his pledges to boost the economy. Indrawati said the challenges awaiting Jokowi’s new team include a worsening global economic landscape that makes the task of reining in the current account deficit arduous.

The wide majority in parliament will not guarantee the success of tough reforms such as overhauling labor laws and opening up more sectors of the economy to foreign investment, according to Sung Eun Jung, an economist at Oxford Economics Ltd. in Singapore.

“Gaining the support from a conservative ruling elite will remain challenging for Jokowi,” Sung said. “He will likely continue to struggle against entrenched interests, stifling his economic reform agenda.”

Jokowi, who was sworn in to office on Sunday, has put economic reform at the heart of his second-term agenda, promising to overhaul laws that hinder investment and job creation. Business tycoon Erick Thohir was named as the State-owned enterprises minister, while Arifin Tasrif was made the energy and mineral resources minister.

Click here for a full list of cabinet members

But the new ministers will need to first deal with a slowing global economy that’s dragged domestic expansion to the lowest in two years. Growth has hovered around 5% for most of Jokowi’s first term, with the International Monetary Fund recently revising down its forecast for this year to 5% from 5.2% in July.

Policy Backlash

Jokowi has also pushed back on a plan by Indonesia’s dynastic families, including some who backed his rise, to amend the constitution to gain greater influence over the government and gradually end direct presidential elections. He’s already facing a public backlash over a plan to amend the criminal code, which would infringe on free speech and human rights, and the passing of a law that weakened the nation’s anti-graft agency.

“The biggest challenge for the new cabinet is sharing the same vision and focusing on teamwork rather than the next election,” said Wisnu Wardana, an economist at PT Bank Danamon in Jakarta. “On the other hand, a grand coalition and political stability is necessary to revise the labor law and other sensitive regulations.”

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To contact the reporters on this story: Arys Aditya in Jakarta at aaditya5@bloomberg.net;Viriya Singgih in Jakarta at vsinggih@bloomberg.net

To contact the editors responsible for this story: Thomas Kutty Abraham at tabraham4@bloomberg.net;Ruth Pollard at rpollard2@bloomberg.net

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