President, House friction 'down to a lack of transparency'

Aditya Suharmoko and Desy Nurhayati , The Jakarta Post , Jakarta | Tue, 03/18/2008 1:14 AM | Headlines

The heightening tension between the administration and the House of Representatives over the central bank governor nomination is the result of a lack of transparency from both sides, economists said Monday.

"Despite the selection process being 'political' because the government has to submit some names and the House has to approve them, the President never communicates his candidates to the public," economic analyst Yanuar Rizki told a discussion Monday.

"Therefore, the House cannot be blamed for rejecting the president's candidates without detailing the reasons," he said.

Last week, the House's Commission XI overseeing financial affairs rejected the two candidates proposed by President Susilo Bambang Yudhoyono -- Bank Mandiri president director Agus Martowardojo and PT Perusahaan Pengelola Aset vice president Raden Pardede.

Yudhoyono promptly responded by demanding an explanation from the commission.

Rama Pratama, a lawmaker from the Prosperous Justice Party (PKS), said some commission members had rejected the nomination to "slap President Susilo Bambang Yudhoyono in the face", and admitted the rejection was "political".

The House will hold a plenary session Tuesday to decide whether it will approve the commission's decision.

Vice President Jusuf Kalla said the government will wait for Tuesday's result.

"There will be lobbying in the House," Kalla said, hinting at a possibility the House could turn the commission's decision around. Kalla heads the Golkar Party, which holds the most seats in the House.

Yanuar said the President should have followed the example of former U.S. president Ronald Reagan, who had campaigned for Alan Greenspan to be the governor of the Federal Reserve, a year before Greenspan was finally elected.

"While here the president suddenly submitted Agus and Raden as candidates without mentioning the reasons, which was for some quite surprising," Yanuar said.

Another economist, Faisal Basri, said the President did not seem to realize both candidates lacked the knowledge necessary to lead a central bank.

While Agus is famous for guiding Bank Mandiri to become the country's largest bank by assets, he is believed to lack monetary policy knowledge.

Raden's track record in leading a major institution meanwhile is practically "unheard of", Faisal said.

"The central bank governor must understand the economic dimensions and have integrity and value," he said.

Faisal recommended the House choose the governor for the country's sake, and not for its own benefit.

"If it insists the BI governor must have an understanding of international central banks, there will only be two candidates: Miranda S. Goeltom and Anwar Nasution," he said, a suggestion widely echoed by commission members.

Miranda is the current central bank senior deputy governor, while Anwar is a former senior deputy governor who now heads the Supreme Audit Agency.

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