Indonesian President Prabowo Subianto on Monday (Sept. 14) dismissed Finance Minister Purbaya Yudhi Sadewa, exactly one year after he took office. Deputy minister Suahasil Nazara, a career economist at the ministry, was promoted to replace him. He is the third finance minister in under two years in Southeast Asia's largest economy, a G20 member.
Markets welcomed the change. After the announcement, the Indonesia Stock Exchange composite index rose 3.29% to 6,534.69 points, and the rupiah strengthened 0.11% to Rp 17,656 per dollar, according to The Jakarta Post.
A turbulent year
Purbaya took over in September 2025 from Sri Mulyani Indrawati, a byword for fiscal discipline among foreign investors, and adopted a more expansionary line. One of his first moves was to place Rp 200 trillion in five state-owned banks to spur lending. More recently, he sought Rp 120 trillion (about $7 billion) from Danantara, the sovereign wealth fund that controls state-owned enterprises, to balance the 2027 budget.
His tenure coincided with a sharp fall in the rupiah and stock market losses. Growth fell short of the government's 6% target: 5.39% in the fourth quarter of 2025, 5.61% in the first quarter of 2026 and 5.29% in the second, according to Asia Sentinel. The minister's approval rating, measured by pollster SMRC, fell from 81.2% to 51.1% in a year.
The clash that brought him down
According to sources cited by Reuters and published by AsiaOne, the trigger was a clash with Djaka Budhi Utama, the customs chief and a former member of the special forces team Prabowo led in the army. Djaka and tax director general Bimo Wijayanto objected to a reshuffle of hundreds of tax and customs officials carried out without prior agreement. Djaka took his complaint to the president on Friday (Sept. 11); by Monday, Purbaya was out.
What changes
Suahasil, 55, has been at the ministry since 2009: he headed the Fiscal Policy Agency from 2015 to 2019 and has been deputy minister since, including under Sri Mulyani. On taking office, he said the budget "must be healthy" and "credible," The Jakarta Post reported.
His first test is the 2027 budget bill, still before parliament, which projects a deficit of 2.85% of GDP (Rp 734.3 trillion). Indonesian law caps the deficit at 3% of GDP — a narrow margin that helps explain why markets reacted to the exit of a minister seen as willing to spend more.
Reporting drew on The Jakarta Post (via Asia News Network), Reuters (via AsiaOne) and Asia Sentinel.
