But some experts say that reforms are in order if the President wishes to make his new economic team more effective at navigating the uncertainties of global economic headwinds.

Shortly after his inauguration in October, Jokowi sought to prioritize expanding the nation’s export portfolio as a main driver of economic growth, including by continuing efforts to seek out trade opportunities in nontraditional markets across Asia, Africa, Europe and Latin America.

This recalibration of priorities, which would have been the biggest to occur since then-foreign minister Hassan Wirajuda overhauled the structure of the ministry in 2002, initially involved a plan to merge the international trade functions of the Trade Ministry with the Foreign Ministry.

The resulting “super ministry” would have been able to act on Jokowi’s instructions to boost Indonesian exports and narrow the current account and trade balance deficits, but the plan garnered mixed reactions from observers and practitioners alike. Some said the structural changes would take too much precious time and energy away from other tasks.

Instead, the President chose to move forward with a second-best option, which was to appoint an erstwhile ambassador to the US, Mahendra Siregar, as the new deputy foreign minister.

“It is a compromise, but at least the government will still be able to boost engagement through economic diplomacy without having to merge the two institutions, as previously planned,” said Poppy Winanti, an international political economy expert from Gadjah Mada University.

However, this compromise apparently came at the cost of effective interagency coordination. It emerged that Mahendra was told to report to the President not through the conventional channel of his boss, the foreign minister, but through an improvised back channel managed by Coordinating Economic Minister Airlangga Hartarto and Coordinating Maritime Affairs and Investment Minister Luhut Pandjaitan.

An official briefing document circulated to the press on the day Mahendra was inaugurated stated that he would report directly to Airlangga and Luhut as a matter of efficiency as the Foreign Ministry did not have direct authority to handle such tasks.

The foreign minister reports to the Office of the Coordinating Political, Legal and Security Affairs Minister.

Luhut, who wields significant influence in government, had also lobbied for the investment portfolio, previously under the proviso of the Office of the Coordinating Economic Minister.

Rocky Intan, a researcher at the Centre for Strategic and International Studies (CSIS), argued that a diverging chain of command for the Foreign Ministry’s top two positions might create difficulties down the line. He thus urged the Foreign Ministry and the Trade Ministry to work together to distinguish the delegation of tasks, especially now that the deputy foreign minister was in charge of coordinating trade negotiations.

For Rocky, however, concerns about the chain of command pale in comparison to his doubts about the foreign service being able to handle even more economy-heavy tasks. "They [diplomats] don’t necessarily have the right skill sets,” he told The Jakarta Post last week.

Former practitioners have also cautioned against reinstating the primacy of economic diplomacy, with former top diplomat Hassan insisting that it was better served as a tool to support economic activities at other ministries.

“[During my time as minister], it seemed as though the people who handled economic matters were more privileged than the others [...] so I discontinued that,” he said, referring to the 2002 ministry overhaul and eventual shuttering of the foreign economic relations department.

Indonesia has doubled down on economic diplomacy after missing out on foreign investments flowing out of China and into its neighbors in Southeast Asia and amid worries of a possible US tariff hikes as part of Washington’s efforts to rebalance its trade deficit with countries like Indonesia.

Observers noted how the administration of US President Donald Trump had essentially forced a major economy like Indonesia to structure its foreign policy priorities to manage economic risk resulting from the trade war, even as economists remained at a premium among Indonesia’s diplomatic ranks.

Mahendra is uniquely suited for the deputy minister post as he is a senior career diplomat who for a time was also the head of the investment coordinating agency, a former deputy minister of trade, finance and international economy, and the chairman or director of several companies.

Speaking after his inauguration, Mahendra said he was put in charge of coordinating all aspects of economic diplomacy, from negotiations and trade promotion to cross-ministerial coordination for the economic dimensions of foreign affairs. But he was quick to add that the foreign minister would determine the strategy employed and that efforts wouldn’t veer from established foreign policy.

“This [coordinating role] is a new kind of responsibility,” he said.

Mahendra was also tasked with concluding trade negotiations with the US in his first 30 days in office, including on an ongoing review of the Generalized System of Preferences — a white list that gives partner countries favorable tariffs on select export products.

He also said he would increase trade with the US to US$20 billion a year and secure international support for a sustainable Indonesian palm oil industry. (dis)

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