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This week in Jakarta: Supersemar, cabinet reshuffle and hip hop economics

This week in Jakarta: Supersemar, cabinet reshuffle and hip hop economics

A Suharto family foundation was ordered to repay millions in embezzled state funds, Jokowi's cabinet ministers underwent a long-awaited reshuffle and the central bank chief put a hip hop spin on Indonesia's economic situation in Jakarta this week.


On Monday, Indonesia's Supreme Court ordered the Supersemar Foundation, operated by the Suharto family, to repay about US$449 million in misappropriated state funds. Reports say the decision was made last month, but only announced on the court's website this week.

The recent ruling was in fact a revision to a 2010 ruling that mistakenly ordered only a fraction of the total amount to be repaid because of a so-called 'typographical error' that knocked hundreds of millions off the debt. That's as good a case as any for the return of the funds to their original purpose: education.

The Supersemar Foundation was set up to fund university scholarships for children from disadvantaged families. For this purpose, it received 2.5% of profits from all state-owned banks, as ordered by a 1976 government regulation. Prosecutors say the money never reached its intended target, instead remaining in the hands of the Foundation and the Suharto family. Further reports have stated that the Foundation, and not Suharto or his family, has been held fully accountable for the embezzled funds.

Meanwhile, President Jokowi on Wednesday acted on demands from his party and the public to reshuffle key ministers in his cabinet. [fold]

His party, the Indonesian Democratic Party of Struggle (PDI-P), ramped up pressure last weekend by demanding a cabinet reshuffle within the week. The head of the party's central executive board put forward names for the chopping block, and recommended that Jokowi announce new ministerial posts after the annual state address on Sunday. Jokowi took heed of the pressure to reshuffle, but at least attempted to do it on his own schedule and terms.

The President announced six new cabinet appointments, not including those recommended by PDI-P. Notably, one of the President's closest advisors, Luhut Pandjaitan, was given a strategic role as coordinating minister for political, legal and security affairs. Technocrats and ministers with international experience were installed in key positions governing trade, maritime affairs, development planning and the economy, while the position of cabinet secretary was given to a senior PDI-P politician, showing some concession to the party's demands. The reshuffled cabinet is expected to help steer Indonesia's economy back towards growth after a shaky start under Jokowi.

Earlier in the week, the country's economic situation was dramatised, quite literally, by the head of Indonesia's central bank.

Agus Martowardojo, governor of Bank Indonesia, created a stir on social media when he dressed up in hip hop gear for an arts and sport event ahead of Indonesia's Independence Day. Swapping his normally conservative attire for baggy pants, dark glasses, a sideways cap and an oversized dollar sign on a gold chain, the central bank chief played the role of an American rapper in a stage drama intended to portray the 'battle' between the US dollar and Indonesian Rupiah.

The drama ended with Agus's optimistic prediction that the value of the Rupiah will improve with external changes in the US economy. He symbolised this in the performance by changing from his hip hop outfit back into an Indonesian batik shirt. A communications officer at Bank Indonesia had the job of explaining the storyline to the media: 'At the start, the US dollar was shown as getting stronger, that's why Pak Agus wore a rapper outfit. But then at the end, the Rupiah got stronger, shown by changing the outfit for batik.'

Local media was sufficiently convinced to suggest a career change for the governor — to the music industry.

Photo courtesy of Flickr user trugiaz.

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