President Treads Fine Line by Empowering Chief of Staff


AUGUST 14, 2015

Jakarta. The biggest, and possibly riskiest, move in Indonesian President Joko Widodo's cabinet reshuffle this week was the appointment of Luhut Pandjaitan as coordinating minister for security and political affairs.

A former special forces chief, Luhut, 67, was already one of the country's most powerful men thanks to his role as chief of staff in the president's office, a job he will keep.

As coordinating minister, Luhut will have six ministers reporting to him, including those with the foreign, home affairs and defense portfolios.

The wily and avuncular ex-general already leads an inner circle of advisers, who together have brought policymaking more squarely under the presidential palace than at any time since the fall of authoritarian leader Suharto in 1998.

With economic growth at its slowest pace for six years, Widodo may feel he needs extra levers of control.

The president has gone into damage-control mode in recent months, bypassing economy ministers and personally intervening to soothe and charm investors. Luhut was brought in by Joko as part of that drive.

The country's first president from outside the political and military elite, Joko is perceived by some to be out of his depth and unable to navigate vested interests in Jakarta.

Insiders say that his unprecedented consolidation of power within the palace shows a determination to assert himself.

But Luhut's emerging role as gatekeeper to the president is not without risks, causing confusion among investors who are key to reviving Indonesia's stalling economy, and alienating the political parties that support him.

'Who's calling the shots?'

For some in the business community, the enhanced powers of the presidential office add to a sense of muddled policymaking that has been a hallmark of Widodo's first year in office.

"We're not sure who's calling the shots on policymaking: is it the presidential office or the ministries?" said one member of the foreign investment community, who asked not to be named due to the sensitivity of the issue.

There is also the possibility that leaders of political parties in Joko's ruling coalition could feel shut out.

Atmadji Sumarkidjo, a deputy to Luhut, said his boss's role was clear "and there shouldn't be any confusion about it".

"He doesn't interfere in any ministry," Atmadji told Reuters. "He only steps in when there is confusion about policy or overlapping regulations.

"When it comes to investors, he is there to facilitate the government and the relationship with businesses. When it comes to politics, it's a natural part of the role of chief of staff to talk to political parties."

Luhut was not available to comment for this article.

The expansion of Luhut's authority has been seen as a sign that Joko is digging in his heels against vested interests.

Earlier this year, Widodo shored up military support by allowing to it to nudge into civilian life, countering the influence of the national police and bringing him into conflict with his main political patron, Megawati Sukarnoputri.


To many, Luhut is something of a chameleon.

Under Suharto, he headed the military's special forces and in retirement remains influential in military affairs.

But after the fall of the Suharto regime, he transitioned into civilian life, serving in successive governments and overseeing a sprawling commodities group.

An early investor in Joko's furniture business, Luhut was quick to distance himself from his party, Golkar, when it threw its weight behind Joko's election rival.

He became a key financier of Joko's presidential campaign and was rewarded with a newly created position in government.

According to members of Luhut's team, their eloquent English-speaking boss holds regular meetings with investors.

As chief of staff, he is also tasked with talking to the opposition coalition that controls the legislature, to make sure Widodo's programs can be passed without a hitch.

But with such wide-reaching influence, Luhut is already ruffling feathers. The vice-president and leaders in Joko's own party, the PDI-P, bristle at being sidelined.

"From what we've seen, the presidential office is just more bureaucracy and we haven't seen any results," said senior PDI-P politician Andreas Pareira.

"In fact, it can make things like communicating with the palace difficult, especially if it's run by a political figure like Luhut. Why do we need him?"

There was some surprise that, in the reshuffle, Widodo resisted demands from his party for more political appointments, and instead brought in technocrats as well as strengthening Luhut's authority.

Observers said Luhut provided political cover for Widodo, who rose from small-town mayor to president of the world's third-largest democracy in just two years, and is still considered a novice on the national scene.

"Keeping Luhut around has probably helped Jokowi manage a tough political situation where there are a lot of interested parties around him, pressuring him," said Jakarta-based political analyst Douglas Ramage.