GOVT NOMINATES CHIEF MINISTER BOEDIONO AS BI GOVERNOR

By Andi Abdussalam

Jakarta, April 2 (ANTARA) - After his two previous candidates were rejected by the House of Representatives (DPR) last month, President Susilo Bambang Yudhoyono named his chief economic minister Boediono as the sole candidate for Bank Indonesia (BI) governor on Tuesday.

        The nomination as the central bank governor of Boediono, who observers say has the competence, will likely get support from the House and positive response from the market.

        "There needs to be no doubt about Boediono's capability to lead BI. He is a brilliant academic who is widely known by the international world," state-owned bank BNI economist Tony Prasetyantono said.

        The House voted to reject President Yudhoyono's previous candidates for the BI governorship, Agus Martowardojo and Raden Pardede, on March 12 after two days of fit-and-proper tests.

        Martowardojo is president director of state-owned Bank Mandiri and Raden Pardede vice president of state-owned asset management company PT PPA.

        The vote on Martowardojo and Pardede was taken by 50 House members representing all of the 10 factions in House Commission XI on financial affairs. Twenty-nine of the 50 legislators rejected both candidates, 21 voted for Martowardojo and none for Pardede while one lawmaker did not attend the vote.

        According to legislators, Boediono is unlikely to face major resistance from the House of Representatives. "It seems that Boediono can smoothly be accepted because he personally has the capability but I don't know exactly the opinions of other lawmakers," Endin AJ Soefihara, deputy chairman of the House Commission XI which among other things deals with financial and banking affairs, said.

        Endin said the House's Commission XI was still waiting for a letter of assignment from the leadership of the House of Representatives to carry out a fit and proper test.

        In the meantime, Commission XI member of the Prosperous Justice Party faction Andi Rahmat said his party could accept Boediono's nomination.

        Besides lawmakers, economists also welcome Boediono's nomination for the BI top post as he is acceptable to the market. He has the needed capability and skill in monetary, fiscal and macro-economic affairs.

        Boediono is a figure who always created optimism. "Though the market is facing turbulences, he always contributes his optimism to market conditions. He is just like a fire extinguisher," Tony Prasetyantono said.

        He said Boediono had extensive knowledge and held various positions of authority in the monetary and fiscal fields.

        Dr Boediono was lucky for being nominated as the sole candidate for Bank Indonesia (BI) governor to succeed outgoing BI Governor Burhanuddin Abdullah who will leave the post on May 17, 2008.

        He was nominated after President Susilo Bambang Yudhohono held a meeting with a number of prominent figures to collect input on who had the competence to assume the central bank's top post.

        Yanuar Rizki of the Indonesian Independent Aspiration Institute said on various occasions that Boediono who currently chief economic minister was a true monetarist.

        "He is like Alan Greenspan who is expert in monetary affairs and modeling," he said.

        Yanuar said a true monetarist would always consider inflation and his policy would always follow economic theories.

        "But whether or not Boediono will try to become a technical man or a modeling one remains to be seen because monetary affairs has nowadays become a matter of thinking smartly, no longer a mere matter of inflation at home," he added.

        M Fauzi Ikhsan, chief economic analyst of Standard Chattered Indonesia, said Boediono had monetary skills. "There is no need to worry about it," he added.

        According to M Fauzi Ikhsan, an economist at Standard Chartered Bank, Boediono is the right person to assume the top post in BI. "The market can accept Mr Boediono well," he added.

        But he suggested that the government do its best to ensure the House of Representatives (DPR) would not reject him. "If he is rejected it will affect the government's credibility and BI's as well," Fauzi added.

        The House of Representatives (DPR) has officially received a letter from the government on Boediono's nomination as the government's sole candidate for the post of Bank Indonesia governor.

        Speaking to the press here on Tuesday, DPR Deputy House Speaker Muhaimin Iskandar expressed hope deliberations on the BI gubernatorial candidate would be completed before the House enters a one-month recess starting on April 10.

        Boediono was born in Blitar, East Java, on February 25, 1943. Besides his post as chief economic minister, he also teaches at the School of Economics of Gajah Mada University in Yogyakarta.

        Before becoming chief economic minister he was finance minister in the Gotong Royong' cabinet in 2001-2004, and minister for national development planning/head of the National Development Planning Board in the Development Reform Cabinet in 1998-1999). He was also a BI director during Soeharto's New Order government. (T.A014/A/HAJM/00:00/a014)

        (T.A014/A/A014/A/A014) 02-04-2008 01:06:25