indonesian central bank gets new governor

indonesian central bank gets new governor

Perry Warjiyo (ANTARA PHOTO/M Risyal Hidayat)

Jakarta (ANTARA News) - The House of Representatives (DPR), through its Commission XI on banking affairs, in a fit and proper test session on Wednesday endorsed the candidacy of Perry Warjiyo as the new Bank Indonesia (BI) governor.

"After holding an internal meeting, all the members of Commission XI from 10 factions in the DPR agreed to elect Perry Warjiyo as BI governor and Dody Budi Waluyo as BI deputy governor by acclamation," Chief of the House Commission XI, Melchias Markus Mekeng said.

Warjiyo, who was elected for the 2018-2023 term, replacing outgoing Agus Martowardojo, is a senior deputy governor of BI who was picked up last month by President Joko Widodo (Jokowi) as the sole candidate for the BI governor`s post.

President Jokowi has nominated Warjiyo for the post of new governor of BI, as he is viewed as a potential candidate for his seniority and experience as the deputy governor of the institution since 2013. The President?s letter of nomination of Warjio was sent to the DPR by the Presidential Secretariat office on February 23, 2018. The president remarked that Warjiyo is competent and has the ability to control any issue and handle challenges that BI must address.

"I think he is a senior deputy who understands (how to handle) matters related to monetary, inflation, and policies in BI and has the relevant experience, track record, achievements, and expertise in the field. I do not think there is a need to doubt his capabilities," President Jokowi pointed out after nominating Warjiyo last month.

According to House Speaker Bambang Soesatyo, Warjiyo has adequate technical capabilities and longstanding experience in the issuance of important policies of the BI.

During the fit and proper test at Commission XI of the DPR on Wednesday (March 28), Warjiyo emphasized the need for industry in the financial sector to take advantage of digital technology and cooperation with technology-based financial sector in the era of fourth industrial revolution 4.0.

He promised to create a National Committee of Digital Economy to optimize the contribution of Micro and Small Medium Enterprises (SOEs) which face problems with obtaining access to financing sources and product marketing.

"Strategy is needed. A national committee for digital economy needs to be set up to synergize policies, empower SOEs and logistics, standardize SOE products which can be done through e-commerce," he said.

Warjiyo explained that SMEs become one of the focuses of the Central Bank because the economic inclusiveness and resilience of SMEs are now exposed to external economic pressures.

The establishment of the National Committee of Digital Economy is one the strategic policies that Warjiyo will perform over the next five years. His policy outline is to encourage economic growth while keeping the stability of the rupiah and inflation.

BI in the next two years will require banks to channel credit to SOEs at least 20 percent of their total loan portfolio.

Warjiyo is the most senior banker and deputy governor in BI and understands the internal conditions of BI. "He is personally warm, diligent, professional, and has adequate technical skills and extensive experience," Soesatyo emphasized.

Chairman of the National Bank Association (Perbanas) Kartika Wirjoatmodjo also lauded Warjiyo as an experienced banker. "He has experience and knows how to maintain monetary instruments for stability while having the driving force to transform the real sector," the Perbanas chairman stated in a seminar in Jakarta last month.

Wirjoatmodjo, who is also the president director of state-owned Bank Mandiri, assessed that Warjiyo has the required experience in the monetary and macro-prudential sectors.

Warjiyo needs to maintain the foundation that has been built by BI outgoing Agus Martowardojo. Hence, the Perbanas chairman expects that Warjiyo, would be able to maintain the balance of monetary instruments.

He opined that outgoing BI governor Martowardojo has managed to keep the inflation low, lower interest rates, and make achievements in the payment system and monetary stability. "It must be prioritized to avoid risks this year, especially since we know the US Federal Reserve is planning to increase its benchmark interest rate to three to four times higher," he noted.

The same view was also echoed by Chief Commissioner of the Deposit Insurance Institution Halim Alamsyah. He believes that the new BI Governor Warjiyo has expertise in monetary affairs.

"Mr. Perry Warjiyo is a BI person. He is a monetary expert and understands the macro-prudential sector," Alamsyah remarked Jakarta on Feb 28. He noted that Warjiyo has experience in working with various agencies, both from within and outside the country.

"Of course, I think, with his integrity and professionalism as well as his approach to prioritize the interests of the nation, he is capable of leading BI," Alamsyah emphasized.