BI governor Soedradjad replaced<\/p>\n
JAKARTA (JP): President Soeharto has removed Soedradjad
\nDjiwandono from his post as central bank governor and appointed
\nSjahril Sabirin, a long time Bank Indonesia career officer, in
\nhis place, Minister\/State Secretary Moerdiono said yesterday.<\/p>\n
Sjahril, 54, had served as a director of the bank since
\nDecember after returning from a three-year stint as a World Bank
\nsenior economist in Washington.<\/p>\n
Like Soedradjad, he will carry a ministerial rank.<\/p>\n
He will be installed by Soeharto tomorrow.<\/p>\n
Soedradjad's replacement had been widely rumored for the past
\nweek amid controversy over the government's plan to adopt the
\ncurrency board system (CBS) to shore up the ailing rupiah's
\nexchange rate.<\/p>\n
When asked about the reason for the change, Moerdiono told
\nreporters in his office that Soedradjad's term had been due to
\nend, along with the other members of the cabinet, on March 1 when
\nSoeharto completed his five-year term as president.<\/p>\n
\"That's why the change,\" Moerdiono said, refusing to be drawn
\ninto further questions on the reason for the removal.<\/p>\n
Soeharto summoned Soedradjad to his Jl. Cendana residence
\nyesterday morning, apparently to inform him of the decision.<\/p>\n
But when reporters asked afterwards whether he had tendered
\nhis resignation, Soedradjad simply retorted: \"No, no.\"<\/p>\n
The official announcement came later in the afternoon.<\/p>\n
\"The President expressed his highest gratitude for
\nDjiwandono's services and he (the President) acknowledged that
\nthe tasks had been very tough,\" Moerdiono said.<\/p>\n
Soedradjad, he added, had been given an honorary discharge.<\/p>\n
When asked whether the President had another assignment for
\nthe former BI chief, Moerdiono said: \"I don't know if the
\nPresident has another task for my colleague, but during my
\nconversation with him, Soedradjad said he wanted to dedicate
\nhimself to the academic world.\"<\/p>\n
There had been unsubstantiated rumors these past few months
\nthat Soedradjad, an economics professor, had tendered his
\nresignation or was planning to.<\/p>\n
When Soeharto replaced four Bank Indonesia directors at the
\npeak of the monetary crisis in December, many analysts believed
\nthat Soedradjad's days were numbered.<\/p>\n
Three of the former directors are now under police
\ninvestigation on suspicion of irregular activities at the bank.<\/p>\n
Soedradjad and his directors came under strong criticism for
\nclosing 16 ailing commercial banks on Nov. 1, a drastic move seen
\nas fulfilling a term set by the International Monetary Fund in
\nreturn for a US$43-billion-loan package it arranged for
\nIndonesia.<\/p>\n
Soeharto's decree removing Soedradjad was signed Feb. 11 but
\nthe decision was only made public yesterday. Informed sources
\nsaid the delay was made to allow Soedradjad host and preside over
\na meeting of Southeast Asian central bankers in Bali last weekend
\nto discuss the monetary crisis affecting the region.<\/p>\n
In spite of the strong rumors these past weeks, yesterday's
\nannouncement still came as a surprise to analysts who feared the
\nimpact it would have on the market.<\/p>\n
\"I think the market has sensed it (the dismissal) over the
\npast two weeks,\" an economist with a local securities company
\nsaid.<\/p>\n
Economists and analysts, who asked for anonymity, said they
\nviewed Soedradjad Djiwandono as a capable and competent governor.<\/p>\n
\"The market and the world knows the capabilities of Soedradjad
\nDjiwandono,\" an economist said, adding that the untimely change
\ncould further undermine the market's confidence in the rupiah.<\/p>\n
Some analysts believed the change was connected to the
\ngovernment's insistence to adopt the currency board system (CBS)
\nof pegging the rupiah to a fixed exchange rate.<\/p>\n
Soedradjad was careful in not letting the public know of his
\nattitude towards the CBS, now being studied by Bank Indonesia.<\/p>\n
But in an interview with a foreign reporter last week, he said
\nhe was not part of the bank's team to study the concept.<\/p>\n
Team<\/p>\n
His successor, Sjahril, is in the team reviewing the law on
\nthe central bank, which is expected to incorporate the CBS idea.<\/p>\n
Sjahril, one of four new directors appointed to Bank Indonesia
\nto fill in the places vacated in December, was summoned by
\nMoerdiono to the State Secretariat office yesterday afternoon to
\nbe informed of his new appointment.<\/p>\n
Later, when asked by reporters on his appointment, he said:
\n\"First of all, I have to thank God for the trust given to me to
\ntake this job. Secondly, I know this is a very difficult task,
\nbut I will endeavor, with the help of the entire staff at Bank
\nIndonesia, to carry out the job as best as possible.\"<\/p>\n
He refused to comment further on his new assignment, or on the
\nCBS debate.<\/p>\n
Born in Bukittinggi, West Sumatra, in 1943, Sjahril had served
\nas Bank Indonesia's director for foreign exchange and human
\nresources from 1988 to 1993.<\/p>\n
He went to work for the World Bank for the next three years
\nand, on returning in December, was asked to work for Bank
\nIndonesia again, this time as director for human resources, money
\nsupply and accounting.<\/p>\n
A graduate of the Gadjah Mada University in Yogyakarta, he
\njoined Bank Indonesia in 1969 and has since seen his career rise.<\/p>\n
When asked to comment on the deteriorating image of Bank
\nIndonesia because of the present monetary crisis, Sjahril said:
\n\"As someone who was born at Bank Indonesia, I'm really saddened
\nat the public impression of the central bank. I know very well
\nthat most BI staff are generally good.<\/p>\n
\"There may be one or two people who have made mistakes, but
\nthis should not reflect on the other staff. I'm a BI officer, I
\nknow the condition there very well.\"<\/p>\n
Removing or reshuffling the cabinet in mid-term is rare for
\nPresident Soeharto but not unprecedented during his 30-year rule.<\/p>\n
In February 1995, Ibrahim Hasan was removed as chairman of the
\nState Logistics Agency (Bulog), but he kept his post as state
\nminister for food affairs. In December 1995, Satrio Budiardjo
\nJoedono was removed as trade minister and his ministry was merged
\nwith the ministry of industry. (prb\/aly\/emb)<\/p>",
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