President installs Luthfi as BKPM head
Muninggar Sri Saraswati, The Jakarta Post, Jakarta
President Susilo Bambang Yudhoyono has dismissed Theo Toemion as head of the Investment Coordinating Board (BKPM) and appointed his former aide during the 2004 presidential election campaign to sit in the post.
"A decree has been signed by the President on the appointment of M. Luthfi as BKPM's new chairman, and the suspension of Theo," Presidential spokesman Andi Malarangeng told the press on Tuesday.
Susilo signed the decree on either Monday or Tuesday, he said.
Luthfi, a former chairman of the Indonesian Entrepreneurs Association (HIPMI), was an aide to Susilo during the presidential campaign last year. Theo, a former Indonesia Democratic Party of Struggle (PDIP) legislator, was appointed as BKPM head by President Megawati Soekarnoputri.
Theo allegedly struck a 14-year-old student referee and quarreled briefly with foreign residents at the Jakarta International School (JIS) during a basketball competition in which Theo's seven-year-old son was playing on April 17.
Theo admitted to slapping the referee in the face after his son was pulled from a children's basketball game. He also reportedly attacked four American executives and an Australian businessman for attempting to intervene. However, Theo branded the reports were exaggerating.
Following the incident, Theo said he would tender his letter of resignation as BKPM chief.
Andi said that after checking with the secretary to the President, there was no resignation letter from Theo.
"I have checked with the president's secretary. To date, there has been no resignation letter from Pak Theo," he said.
It was already time for Theo to be replaced, Andi said.
"It was based on professional concerns, and also to give new spirit to the investment environment," he said.
The government plans to strip away some of the authority of the BKPM to issue investment approvals in a bid to attract more foreign investment.
The move is expected to reduce the amount of time needed for foreign businesses to start operations here. Until now, the BKPM has been authorized to process all investment permits and certain other licenses related to business activity.
The government has also lowered the status of the BKPM and put it under the coordination of the Ministry of Trade. However, it will continue to directly report to the President.