The 3 divas keep the Indonesian economy on track

By Sara Webb Reuters
Published: November 8, 2007

JAKARTA: They are called the three divas, but the three most powerful women in Indonesia are anything but prima donnas.

They are economists who together are setting the biggest economy in Southeast Asia on track for its fastest growth in 11 years.

Finance Minister Sri Mulyani Indrawati, Trade Minister Mari Pangestu, and the central bank's senior deputy governor, Miranda Goeltom, form an unusual clique in a country where the establishment is dominated by men.

"We know each other very well. The chemistry is always very good between the three of us," Indrawati, a former International Monetary Fund director, said in a recent interview.

While the three play golf and lunch together, Indrawati said she valued the fact that she can discuss economics with the other two, particularly given the isolated nature of her job.
"It's something we can enjoyably share," she said.

"Being a minister of finance, you feel really lonely and alone," she said. "If you are mingling too closely with the business community they will accuse you of being too close, and if you are mingling with the political parties they think you are busy politicking. I have to keep a distance."
Indonesia, the most populous Muslim country, has had relatively few high-profile women in its government.

Its first female president, Megawati Sukarnoputri, owed her position in part to her pedigree - her father, Sukarno, was the first leader after independence.

But while Sukarnoputri, a former housewife, kept a low profile, the three divas are familiar faces at the International Monetary Fund, the World Bank, and the international trade circuit - though some nationalists say they are too cozy with these institutions.

In contrast with many of her tight-lipped foreign counterparts, Goeltom, the central banker, is regularly quoted in the media, most recently on the economic impact of high oil prices.
She often speaks in public, and she is famously unpunctual - a trait that saved her life in 2003, when she was stuck in traffic and arrived late for lunch at the Marriott hotel in Jakarta, missing a bomb attack by minutes.

Now Goeltom and the central bank governor, Burhanuddin Abdullah, are in the spotlight again as economists await further credit easing.

The benchmark interest rate has fallen to 8.25 percent from a high of 12.75 percent in April 2006 after 13 rate cuts, as inflation has eased.

The cuts in rates have triggered domestic consumption, spurring economic growth that is set to hit 6.3 percent this year.

Exports are bouncing back, and foreign direct investment, which faltered on worries about corruption, bureaucracy and legal uncertainty, is close to its 2000 record of $9.8 billion.

One reason for the recovery, Indrawati says, is that reforms are starting to have an effect.
President Susilo Bambang Yudhoyono, a former general, was elected in 2004 on the back of promises to increase growth, create jobs and tackle graft in a country that year after year ranks among the most corrupt.

When Indrawati, 45, was appointed finance minister, she embarked on a cleanup of Indonesia's notoriously corrupt tax and customs departments in a bid to raise state revenues.

The former academic, whose dissertation was on how men and women respond to tax policies, has a tough job ahead of her, as only one Indonesian in 170 pays taxes.

For years, tax bills were often settled by greasing palms, but now it is getting harder for the well-heeled to keep the tax office at bay. Indrawati has replaced corrupt officials and raised salaries for officials in the ministry so they are not tempted to steal or solicit bribes.

Her officers are investigating companies that deliberately understate their profits in order to pay less tax, and they are tracking down wealthy lawyers, bankers, property owners - even platinum cardholders - many of whom get a nasty shock when officials phone or drop by to check on them.

Restoring public trust in government departments and institutions has become an obsession for Indrawati, who said she felt she had at least inspired "a positive and contagious disease, a reform fever" among many tax and customs bureaucrats.

While Indrawati tackles tax issues, Pangestu wants to raise the profile of Indonesian exports.
"Where would the world be without Indonesia?" the trade minister joked recently, pointing out that the country made a substantial portion of the world's zippers, Barbie dolls and false eyelashes.

Pangestu is a rare breed in the cabinet, not just because she is female, but because she is the only ethnic Chinese.

The minority Chinese account for a disproportionate share of the country's wealth, and their success is sometimes resented. An anti-communist coup in the 1960s led to their suppression, and their language, writings and customs were banned or discouraged until relatively recently.

Pangestu has lived in boomtown Shanghai, where many Indonesian Chinese, including some of the country's wealthiest tycoons, keep homes and run their businesses - valuable firsthand experience for an economist charged with turning Indonesia into a roaring Asia tiger once again.