Indonesia looks to Islamic finance for infrastructure needs – Nikkei Asian Review

JAKARTA — Measures to boost Indonesia’s relatively small Islamic finance sector could help the government implement an ambitious infrastructure modernization program across the 13,000-island archipelago, according to the country’s recently appointed finance minister. A week after she was appointed finance minister by President Joko Widodo in a cabinet shake-up, Sri Mulyani Indrawati described Indonesia’s infrastructure development needs as “huge.” Indrawati was speaking at the World Islamic Economic Forum in Jakarta. After taking office in late 2014, Widodo pledged to improve Indonesia’s notoriously rickety infrastructure by building or improving dozens of ports, airports, power plants and roads. Total spending could reach around $500 billion — equivalent to more than half the country’s gross domestic product — an outlay that the government says it cannot fund alone. “I am sure there is the potential to develop instruments for financing based on Shariah (Islamic law), we will look at this, the need is there,” said Indrawati, who resigned from a senior World Bank role to rejoin the Indonesian government.

New finance minister Indrawati chops $10bn from Indonesia’s budget – Nikkei Asian Review

JAKARTA — Sri Mulyani Indrawati, Indonesia’s new finance minister, said on Wednesday that 133.8 trillion rupiah ($10 billion) will be cut from government spending this year in anticipation of a widening shortfall in tax revenue. The former World Bank Group managing director, who also served as finance minister from 2005 to 2010, was brought back into cabinet a week ago. “The President’s theme is strengthening credibility, confidence, and trust,” Indrawati told reporters on Aug. 3 following a meeting with President Joko Widodo and his economic ministers. A day later, speaking to reporters at the World Islamic Economic Forum in Jakarta, Indrawati said the finance ministry should use “all tools to improve the business climate”. “Job creation is not coming from the government — it is from the private sector,” the minister said.