Sri Mulyani Indrawati, Indonesia's outgoing finance minister, speaks during a handover ceremony in Jakarta, Indonesia, on Tuesday, Sept. 9, 2025. Indonesian President Prabowo Subianto abruptly replaced Indrawati as finance minister, risking renewed market turmoil for South-East Asia’s biggest economy following violent protests in recent weeks against his administration. - Bloomberg
JAKARTA: Over the last weekend in August, after her house was ransacked by looters, Indonesia’s then-Finance Minister Sri Mulyani Indrawati travelled to President Prabowo Subianto’s country estate in the Hambalang hills in West Java. She planned to resign.
The country had just been rattled by its worst unrest in years. This was at least her second attempt to quit, after one in March amid a market meltdown, partly driven by rumours of her departure.
For a second time Prabowo rejected her offer, uncertain he had a suitable replacement.
But by Monday (Sept 8), advisers had convinced him a shakeup was necessary and she was gone, switched out with economist Purbaya Yudhi Sadewa.
This account of her firing, based on interviews with people familiar with the situation, who spoke on the condition they not be identified discussing private matters, encapsulates a key tension in Prabowo’s presidency between the former general who wants to spend big and the technocratic economist focused on fiscal discipline.
Prabowo governs convinced that he can boost the economy through expensive social programmes and strong-arm central control, which risks over-torquing the country’s US$234 billion budget.
Indrawati, 63, had served in three administrations, as well as stints at the International Monetary Fund and World Bank. She had the respect of global investors and bondholders, lending a veneer of fiscal legitimacy to Prabowo’s ambitions, which kept markets at ease.
But after her two previous attempts to resign, Prabowo decided to find a replacement.
As public anger over inequality and economic anxiety boiled over last month, leaving at least 10 dead across the country, Prabowo’s advisers urged a cabinet purge that would show the president took the public concerns seriously.
Indrawati had already tried to quit before, they reasoned, which raised doubts about her commitment. And persistent rumours of her departure had kept markets jittery, they said, making it better to appoint someone new and provide a clear direction.
Prabowo’s office declined to comment. Indrawati didn’t respond to a request for comment.
One figure central to advising Prabowo was former senior minister Luhut Pandjaitan. He suggested an economist who had worked with him for years when he was coordinating minister for maritime and investment. He was no-nonsense, neutral, someone markets could trust. He was known within the finance ministry, but not to most of Prabowo’s inner circle: Purbaya Yudhi Sadewa.
Luhut couldn’t be reached for comment.
Purbaya, 61, also got a call from the presidential palace Monday, summoning him for a meeting. He would later say he thought it was a prank, and found himself later alongside four other new ministers at a swearing in ceremony.
The call to Indrawati from the presidential palace also came Monday, when she was directing a ministerial meeting in the afternoon. She stepped out to speak on the phone. When she returned, she dismissed everyone except her deputies and top officials. She then waited for the news of her replacement to be announced.
The next day, she and Purbaya attended a handover ceremony, as a show of continuity. Hundreds of finance ministry officials cheered her arrival, and she appeared to be tearing up.
In her remarks, Indrawati apologised for any missteps, saying "no human is perfect.”
"I entrust you to continue to safeguard state finances,” she told her former colleagues, urging them to "help the new leadership.”
She then said farewell, and asked for her privacy be respected "as an ordinary citizen.” - Bloomberg
