Indonesian president Prabowo Subianto on Monday removed finance minister Sri Mulyani Indrawati in a cabinet reshuffle following deadly anti-government protests across the country.
Sri Mulyani is an influential figure who once served as managing director of the World Bank and was finance minister under three different presidents. Her house was ransacked during the recent protests over lavish perks for lawmakers.
Purbaya Yudhi Sadewa, an economist who previously served as the chief commissioner of the Indonesia Deposit Insurance Corporation, was appointed as her successor, according to a presidential decree.
Prabowo did not give any reason for Sri Mulyani鈥檚 removal from the cabinet. He also honourably discharged chief security minister Budi Gunawan and sports minister Dito Ariotedjo.
Bhima Yudhistira Adhinegara, executive director of the Center of Economic and Law Studies, said Sri Mulyani鈥檚 removal was not surprising, considering the recent economic situation in the country.
鈥楾he demand to remove Sri Mulyani has long been voiced by various think tanks and civil societies as a criticism of her inability to push for a fair taxation system,鈥� he told AFP.
鈥楤ut certainly the market鈥檚 reaction to short-term risks will be volatile, but it is only temporary.鈥�
Bhima said the new finance minister needed to take into account the purchasing power of the middle and lower classes when implementing tax revenue strategies in order to quickly restore public trust.
He also said the new minister must be able to put the brake on Prabowo鈥檚 ambitious programmes, such as free meals for schoolchildren and a programme to boost national food security by creating large-scale agriculture areas, which has been heavily criticised by environmentalists.
The demonstrations in late August are the biggest and most violent of Prabowo鈥檚 presidency and a key test for the ex-general less than a year into his rule.
Protesters rallied over low wages, the unemployment rate, and perks for lawmakers.
Jakarta stocks closed down 1.28 per cent following the announcement of Sri Mulyani鈥檚 removal from the cabinet.
