By IPS Correspondents
JAKARTA, Oct 21 2004 (IPS)

Susilo Bambang Yudhoyono was sworn in as the sixth president of Indonesia Wednesday but the celebratory mood ended later that night when he disclosed his cabinet, defined by some analysts as a classic example of political horse-trading.

Present at the ceremony, held in the same building occupied by students that led to the end of the 32-year reign of dictator Suharto in 1998, were the prime ministers of Australia, Singapore and Malaysia.

Conspicuous in her absence was outgoing president Megawati Sukarnoputri, who has refused to acknowledge defeat, let alone congratulate Yudhoyono who crushed her during the election.

After the oath, Yudhoyono delivered a brief but well received speech where he asked for time and pledged to fight terrorism and corruption and improve the economy.

Then, just before midnight, he announced his cabinet line-up, and the party mood was over.

The cabinet presented clear signs of political compromises, failed to live to most analysts’ expectations and gave rise to the first real criticisms of the new leader.

”All in all, it was a clear example of compromises. It lacks cohesion and it shows that the president is undecided, and has no political character,” said Wimar Witoelar, head of a communications consulting firm and spokesperson of former president Abdurrahman Wahid.

Only slightly more contained was Umar Juoro, chairman of the Centre for Information and Development Studies (CIDS), who said that he expected Yudhoyono to show more leadership.

”The way he formed the cabinet, shows that he bends,” he told IPS.

Though Indonesia has partially recovered from the 1997-98 Asian economic crises, the largest Muslim nation in the world has 40 million people considered unemployed or under-employed and is plagued by endemic corruption that seeps into every layer of society.

As Yudhoyono was being sworn in Transparency International released its annual corruption index, with Indonesia ranking eighth from bottom – a ranking that has dropped since Suharto stepped aside.

In the last few years, the country has also become a hotbed for international terrorism and a target of attacks, including the infamous bombing attack on the resort island of Bali that claimed 202 lives.

With such a backdrop of problems it was obvious that the economic ministers and the position of attorney general were going to be the most scrutinised.

Here, according to some analysts, Yudhoyono has chosen the candidate imposed by circumstances rather than the best person for the job.

None of the appointments were more controversial than Aburizal Bakrie as coordinating minister for the economy.

Bakrie is a man from the old regime, a Golkar party executive and a businessman tainted by his past dealings. By appointing Bakrie, Yudhoyono might have appeased the opposition of Golkar, Suharto’s former political vehicle, and the main party in the House of Representatives, where Yudhoyono’s own coalition is in the minority.

Bakrie’s political past saw him holding the positions of coordinating minister for the economy and finance minister under then president Abdurrahman Wahid, in what was one of the worst times for the country’s economy. He also heads a multinational business that defaulted on more than one billion U.S. dollars in debts during the 1998 Asian financial crisis.

”In a nutshell, Bakrie is a businessman and he believes that the ends justify the means,” said Witoelar adding that for such a crucial position it would have been better to have someone with a credible ”moral character”.

CIDS’ Juoro said Bakrie had lots of experience but still doubted if he was the right man for the job.

”The question to answer is how he will handle the conflict of interests,” he said.

The Jakarta stock market has also taken a wait-and-see attitude and the rupiah lost slightly against the dollar.

”The market is giving the government the benefit of the doubt,” said Fauzi Ichasan, vice president and global market economist of Standard Chartered Bank in Jakarta.

This is partly due to the new finance minister, Yusuf Anwar.

Anwar, a long serving bureaucrat with experience at the Asian Development Bank, got the nod over long time front runner Sri Mulyani Indrawati, currently an executive director of the International Monetary Fund’s Asia division.

The decision to favour Anwar is seen as another caving-in by Yudhoyono, this time under pressure from the Islamic based Prosperous Justice Party (PKS), who threatened to withdraw its support from his coalition if he picked ”pro-IMF” economists.

The IMF is hated by most Indonesians who see it has having hampered Indonesia’s recovery from the economic crisis.

Sri Mulyani was eventually awarded the development planning ministry, which is clearly of secondary importance. A similar fate was shared by two other respected economists: Mari Pangestu in trade and the Andung Nitimihardjo, who was assigned industry.

The position of attorney general was also open to controversy since the favourite Marsillam Simanjuntak was overlooked in favour of Supreme Court Judge Abdul Rahmen Saleh.

Marsillam, who distinguished himself as attorney general under president Wahid, was believed to be the best pick in Yudhoyono’s promised war against corruption.

According to Witoelar, Marsillam had a minimum of eight high profile graft cases, in which he was ready to open proceedings. That, he said, might have scared off some of Indonesia’s elite, most of whom are tainted by corruption.

However, no one had a bad word for Saleh, who was the only judge to deliver a dissenting opinion when Akbar Tandjung, Golkar party chairman, was acquitted of corruption – after he appealed against his case in 2002.

”He is a good person and a good judge,” said Emmy Hafild, secretary general of anti- corruption watchdog Transparency International Indonesia.

The United Indonesia Cabinet, as the Yudhoyono’s government is called, consists of three coordinating ministers, 19 ministers, 10 state ministers, the minister/state secretary, cabinet secretary, chairperson of the national Development Planning Board and attorney general. Among them there are four women, four former general and two Christians.

The new executives are expected to take office as from Friday.

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