President installs Luthfi as BKPM head

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.