10 October 2025 (closed)
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Prabowo Appoints Loyalists in Cabinet Reshuffle: Shift in Economic Policy?
A month ago, we reported on the large demonstrations that occupied the streets of various Indonesian cities in late August 2025 and early September 2025, touching on structural inequality and corruption in Indonesian society that cause persistent frustrations to simmer beneath the surface.
The demonstrations put heavy pressure on Indonesian President Prabowo Subianto, who acted swiftly by changing the composition of his cabinet on 8 September 2025. However, one can wonder whether the reshuffle really reflects the aspirations of the Indonesian people as Prabowo appointed a couple of loyalists. Therefore, it gives the impression that Prabowo used the situation to gain more control over the cabinet.
However, this could be with good intentions, though. Perhaps, Prabowo was of the opinion that those ministers who were replaced (who were selected last year to join the cabinet as the result of political bargaining with President Prabowo’s coalition members and/or his political allies) were slowing down public economic and social development programs, thereby triggering slower-than-desired development, thus contributing to the anti-government demonstrations in August 2025.
The best example is (former) Finance Minister Sri Mulyani Indrawati. Generally, Sri Mulyani is a highly regarded professional (a non-partisan technocrat) who gave the Red and White Cabinet of Prabowo fiscal credibility. When Sri Mulyani was asked by Prabowo to continue her duty as Finance Minister in Prabowo’s cabinet in October 2024, many were surprised. After all, during former President Joko Widodo's second term (2019-2024), Prabowo (back then Defense Minister) allegedly clashed with Sri Mulyani over funding for the Defense Ministry as she was too prudent compared to Prabowo’s ambitious and expensive spending proposals.
Therefore, most analysts thought Sri Mulyani’s days in the cabinet were numbered when Prabowo won the 2024 presidential election. Why Prabowo asked her to stay on as Finance Minister is a matter of speculation but there are two plausible reasons: (1) as mentioned above, her presence gives the cabinet fiscal credibility, suggesting that (foreign) investors (portfolio and direct investors) are more willing to invest on the back of stability and continuity, or (2) it might have been part of negotiations.
It is no secret that former President Widodo and Sri Mulyani were allies. In order to get Widodo’s support (in the form of his son Gibran Rakabuming as Prabowo’s vice-presidential candidate in 2024; which proved to be a successful strategy) it could be that a couple of Widodo allies or loyalists had to join the Prabowo cabinet.
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