Indonesian officials have dispelled rumors about the resignation of Finance Minister Sri Mulyani Indrawati, reassuring investors after a dramatic drop in the stock market.
On March 18, Indonesia’s parliament deputy speaker, Sufmi Dasco Ahmad, addressed concerns at a stock exchange briefing, asserting that Indrawati remains in her position and that the country maintains a robust fiscal standing.
Ahmad, a key figure in President Prabowo Subianto’s Gerindra party, clarified that the plunge in equities was not linked to Indrawati’s rumored departure.
The stock benchmark index initially plummeted by 7.1%, marking its steepest decline since 2011, before recuperating to a 3.8% drop following government statements.
Indrawati continues her ministerial duties, confirmed Hariqo Wibawa Satria, spokesperson for the Presidential Communications Office, labeling the resignation rumors as false in an Instagram video posted late Monday.
Bank Indonesia intervened to stabilize the rupiah as speculation swirled about potential Cabinet changes instigated by President Prabowo, possibly affecting Indrawati, who has navigated Indonesia’s finance ministry for 14 out of the past 20 years.
The Indonesian central bank will meet tomorrow to discuss the country’s borrowing rates in which the market has been anticipating for a pause, leaving the benchmark at 5.75%.
Indrawati’s adept management has been crucial during crises, notably guiding Southeast Asia’s largest economy through the COVID-19 pandemic via exceptional debt monetization measures in partnership with the central bank.
Her dedication to fiscal responsibility saw the government achieve its budget deficit target, reducing it below the 3% GDP threshold by the end of 2022, a year ahead of schedule. Her leadership in tax and budget reforms has been instrumental in securing investment-grade debt rating upgrades from S&P Global Ratings.
