Finance minister Agus Martowardojo in fit and proper test for Bank Indonesia governor | Insider executive data
(Insider Stories)-President Susilo Bambang Yudhoyono has made a surprise decision to nominate finance minister Agus Martowardojo for the top position at the central bank.
Although Martowardojo is a respected figure within the investment community, there are many doubts that he can gain enough support from lawmakers to win the job.
In Indonesia, the central bank governor position is considered as the most prestigious position in the financial sector.
As a former executive at a commercial bank, a role which was previously supervised by Bank Indonesia, many believe there will be a resistance within the central bank itself for his presence.
The former chief executive officer at PT Bank Mandiri (BMRI) was rejected by lawmakers when Yudhoyono proposed his name in 2008.
Yudhoyono then appointed the seasoned banker as finance minister in 2010 replacing the highly regarded Sri Mulyani Indrawati, who resigned the position to take up a new role at the World Bank in the U.S.
Yudhoyono then proposed Darmin Nasution, a senior figure within the finance community, who has held several important positions financial posts. Lawmakers in 2009 voted to approve Darmin, a former tax director general and chief of the Capital Market and Supervisory Agency (Bapepam LK), for the central bank governor top.
Some believe Agus is not senior enough to take over the role from Nasution, who is regarded to have been guru to Sri Mulyani Indrawati when they attended the Institute for Economic and Social Research (LPEM FEUI), even though Indrawati held a higher position at the time.
After his time in the top position at the finance ministry, Yudhoyono is now confident to propose again for Martowardojo to lead the central bank, which now still supervises around 120 commercial banks in Indonesia.
However in the future, when a new financial regulatory “superbody”, the OJK, assumes the supervisory job, the central bank will still play an important role in the country’s monetary affairs, a job many doubt Agus can perform.
At a time when Yudhoyono’s Democratic party is in the spotlight following a series of corruption scandals involving some top figures, the fit and proper test would be a battle to measure Yudhoyono’s influence in the House of Representatives (DPR). Agus told media he is ready for the job and has prepared some answers to critical questions expected from lawmakers.
