Darmin Will Restore Rupiah: Analyst

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  • TEMPO.CO, Jakarta - Ari Kuncoro, the dean of school of economics at the University of Indonesia asserted that Darmin Nasution's appointment as the new Coordinating Minister for Economic Affairs was the right decision. According to Ari, Darmin is the right person to address the issues with economics in Indonesia, particularly those related to the Rupiah's exchange rate.

    Ari believed that Darmin would be able to work with Bank Indonesia to improve rupiah's exchange rate.

    "Darmin had served has BI governor, so he can partner with BI to strengthen the Rupiah. BI is an independent institution, and the government cannot control it. But Darmin, who was a former BI governor will be able to do that," Ari told Tempo on Wednesday, August 12, 2015.

    Ari said that the new government needs a senior figure to manage the economic sector. The weakening Rupiah has become Indonesia's biggest issue that affects all commodities in the country.

    "[Darmin's] experience as BI governor would reflect his knowledge related to monetary issues. Darmin would know the ideal rate [for rupiah]," Ari said.

    Ari added that Darmin must also improve budget absorption and tax revenue by coordinating with other ministers. Ari hoped that Darmin would be able to conduct better observation on the market.

    "We need a coordinating economic minister who has cross-sector understanding. We will see that in the future. Currently, there is hope for economic improvement," Ari added.

    Earlier on Wednesday, August 12, 2015, President Joko "Jokowi" Widodo inaugurated Darmin Nasution to replace Sofyan Djalil as the Coordinating Minister for Economic Affairs. Sofyan was reassigned to serve as the National Development Planning Agency Minister, replacing Andrinof Chaniago.