Technocrats the way to go in politics; Political considerations have not served Indonesians well in several sectors, and capable and honest administrators are needed

Updated: Tuesday March 18, 2014 MYT 10:42:13 AM

Technocrats the way to go in politics



Gita Wirjawan

Political considerations have not served Indonesians well in several sectors, and capable and honest administrators are needed.

ON Jan 31, 2014, Gita Wirjawan, who was Indonesia’s Trade Minister, surprised everyone by resigning from his Cabinet post in order to concentrate on his nascent political career.

Gita – a Harvard-educated investment banker turned government official – is running in the ruling Democratic Party’s presidential primaries.

He’s also a close confidant of President Susilo Bambang Yudhoyono (SBY).

While the Democrats are suffering from corruption scandals and the sheer fatigue of incumbency, Gita is a fresh face who has both integrity and policy smarts.

His move is likely to turn the heat on his political rivals.

Still, Gita is not the only technocrat who is toying with full-time politics.

His fellow Democrat hopefuls (all technocrats par excellence) Anies Baswedan and Dino Patti Djalal have also put their careers on hold.

However, given the current mood vis-à-vis politicians, maybe they should all reconsider their choices.

As disenchantment with professional politicians grows, voters are looking to technocrats to fill the leadership void.

This isn’t something new. When Suharto became President in 1967 (having taken effective power from Sukarno in 1965), Indonesia’s economy was in dire straits and parts of the country were on the brink of famine.

Suharto moved to rope in a group of US-educated Indonesian economists, dubbed the “Berkeley Mafia” (after the alma mater of several of them) for his administration.

Prominent members of this group included the respected economist Widjojo Nitisastro, who eventually became Indonesia’s Coordinating Minister for Economy, Finance and Industry in 1973.

There was also Emil Salim, who among other things was Minister of State for Development, Supervision and the Environ-ment from 1978–1983.

Under the Berkeley Mafia, Suharto’s New Order reversed Sukarno’s policies of nationalisation and heavy borrowing in favour of deregulation, controlling inflation and producing a balanced budget.

While many blamed them in later years for failing to rein in Suharto’s excesses, under their watch, Indonesia’s economy enjoyed three decades of economic growth averaging at around 6.5% per annum between late 1960s and 1997.

Fast-forward to today and Indonesia still needs technocrats, if not more so.

SBY has drawn from their “class” extensively – Boediono, Chatib Basri, Dahlan Iskan and Sri Mulyani Indrawati.

All of them have played a vital role in managing Indonesia’s economy in the wake of recent global economic uncertainties.

But their tenure is coming to an end and it would be a tragedy if the next government – whoever leads it – privileges political ties above talent.

Because, make no mistake, Indonesia’s economy, although promising, is facing huge challenges.

Inflation rose 11.35% in 2013 due to increases in staple food prices, including rice.

This in turn can be attributed to failed agricultural policies.

Indonesia is an enthusiastic practitioner of import restrictions for agricultural products in the name of protecting local farmers.

Such policies have, however, not included complimentary attempts to boost local agricultural production.

This inevitably results in shortages, which further drives prices up.

At the same time, Indonesia’s education is sorely under-performing despite US$30.4bil (RM99.5bil) (or 20% of the entire state budget) being funnelled to it last year.

A major controversy erupted last year when it was announced that under a new curriculum, Indonesian school children would spend less time learning science, English and information technology (IT) in favour of Bahasa Indonesia and religious as well as civic studies.

Clearly, political considerations have not served Indonesians well when it comes to agriculture and education.

These are just two policy sectors for which Indonesia needs capable and honest administrators.

This is all the more so with the advent of the Asean Economic Community in 2015 looming, when already-intense regional competition will become a brutal free-for-all.

Regardless of where his political future takes him, men like Gita can transform the Republic.

So in conclusion, Indonesia needs more technocrats, not less, and two critical ministries – Agriculture and Education — require professional leadership to propel the Republic forward.

Come to think of it, having more technocrats in our Cabinet could also do Malaysia a world of good.



About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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