Pacific Money | Economy | Southeast Asia

Indonesia Replaces Finance Minister Amid Growing Investor Skepticism

The appointment of Suahasil Nazara, who has served as deputy finance minister since 2019, is intended to calm investors worried about Jakarta’s fiscal profligacy.

Suahasil Nazara, then Indonesia’s deputy finance minister, participates in a meeting in Bali, Indonesia, Aug. 10, 2025.

Indonesia’s President Prabowo Subianto has fired and replaced his finance minister, Purbaya Yudhi Sadewa, just over a year after his appointment.

Suahasil Nazara, 55, who has served as deputy finance minister since 2019, was yesterday sworn in as Purbaya’s replacement.

The government did not say why Purbaya was removed, but his year in the post has been marked by ructions in the Indonesian economy, including a sharp depreciation of the rupiah and growing investor skepticism.

After being sworn-in yesterday afternoon, Suahasil told the press that he had only learned about his appointment in the morning.

“This is, of course, an expression of the trust placed in me by the president and the country. I am grateful for that trust, and I hope I can carry out the responsibility entrusted to me by the president,” Suahasil said, as per the Jakarta Globe.

He added that Prabowo had instructed him to safeguard “the health and credibility” of the state budget.

The replacement of the finance minister comes after a turbulent year at the top echelons of Indonesia’s major economic institutions. In late July, Perry Warjiyo, the governor of Bank Indonesia, the country’s central bank, stepped down, two years before the expiry of his current term as BI governor.

Purbaya was appointed finance minister last September, after the resignation of Sri Mulyani Indrawati, who had served in the post under three presidents. While Sri Mulyani initially agreed to serve in the role under Prabowo after he took office in October 2024, she eventually was forced out, reportedly due to differences between her conservative economic approach and Prabowo’s fiscally expansive economic agenda. The Indonesian president has set an ambitious goal of 8 percent annual GDP growth for the rest of his term, and he introduced a number of high-spending populist policies, including a multibillion-dollar free meal program, that have widened the fiscal deficit.

The removal of Sri Mulyani unsettled investors who were already unsure about Indonesia’s economic trajectory under Prabowo. The year since her departure has only compounded these concerns. In March, both Moody’s and Fitch announced ratings outlook downgrades........

© The Diplomat