PRESS RELEASE

THE COORDINATING MINISTRY FOR ECONOMIC AFFAIRS
REPUBLIC OF INDONESIA

HANDOVER OF COORDINATING MINISTER POSITION FROM BUDIONO

TO SRI MULYANI INDRAWATI

Jakarta, 24 June 2008 - Boediono and Sri Mulyani Indrawati today conducted the formal handover of the position of Coordinating Minister for Economic Affairs. The occasion was a result of Presidential Decree of 13 June 2008 in which Sri Mulyani was appointed, in addition to her duties as Minister of Finance, to undertake the Tasks, Authority and Responsibilities of Coordinating Minister of Economic Affairs. Meanwhile Boediono assumed the post of Governor of Bank Indonesia on 22 May.

The formal handover of the position of Coordinating Minister was attended by a number of ministers, officials from the Coordinating Ministry of Economic Affairs, the Department of Finance and representatives from a number of other institutions. In a direction to staff of the Coordinating Ministry before the ceremony, Coordinating Minister Sri Mulyani explained that although dual positions required a focus and amount of time greater than that required for a single position, she firmly believed that this would in itself increase the efficiency of coordination. "The Coordinating Minister of Economic Affairs is tasked with coordinating the framing of policies and their implementation, whereas the Minister of Finance is the fiscal authority with responsibility for budgetary coordination. I will combine these two responsibilities in a manner that will improve the effectiveness of coordination within the Economic Team in the United Indonesia Cabinet," said Sri Mulyani.

In reference to the sectors she considered priorities, the Coordinating Minister stated that food, energy and infrastructure were of the utmost importance. "These three sectors are priorities because the world is currently facing high food and energy prices. At the same time, the development of infrastructure through budgetary outlays and partnerships between government and the private sector represented a challenge in improving the national investment climate and level of competitiveness," said Sri Mulyani.

More generally, the Minister stressed the importance of the implementation of a number of important policies that have been awaited by investors. These included regulation of investment services, fiscal incentives for investors, the development of Special Economic Zones including Batam, Bintan and Karimun; and improvement of performance in the logistic sector.

To improve coordination between Ministers, Coordinating Minister Sri Mulyani explained that she was currently finalizing a procedure which, in a pro-active manner, would support all members of the Economic Team in meeting their commitments on policy implementation in a timely manner and in line with established goals. "The remaining time of the Economic Team is very short, so we must work harder and more effectively," said the Minister. "Decisions have to achieve quick results in order to provide certainty to the public and the business world. For this reason, my priority is to finalize a number of policies the business community has been waiting for immediately."

Additionally, Sri Mulyani, who also serves as Finance Minister,reminded her staffs that the macroeconomic stability achieved by means of coordination of fiscal and monetary policy must continue to be sustained and even increased. "With Pak Boediono as Governor of BI, the coordination between the fiscal and monetary authorities will be improved, in order that stability is maintained well and becomes the foundation in accelerating economic growth and control of inflation," she said.

The Minister also reminded officials at the Department of Finance that additional workloads she was adopting as Coordinating Minister for Economic Affairs would not reduce her attention and commitment to the reform of the bureaucracy within the Department of Finance itself. Steps toward the reform of the bureaucracy begun two years ago had already demonstrated improvement, albeit more slowly than had been hoped. "I want to see the reform of the bureaucracy at the Department of Finance reach the point of no return by the end of my term of office next year. Only in that way will be the public be able to believe that reform will bring structural and permanent improvement," said Sri Mulyani. Coordinating Minister Sri Mulyani plans in the immediate future to hold a Ministerial Level Coordination Meeting to discuss priorities and working procedures.

-00-