Purbaya Says He Half Expected Sacking as Indonesia Swaps Finance Minister

Indonesia's ousted finance minister, Purbaya Yudhi Sadewa, said he was upset at being removed from his post this week but had half expected the decision, speaking a day after President Prabowo Subianto abruptly replaced him.

Purbaya learned of his termination on Monday through a phone call with the president's spokesperson, Prasetyo Hadi. He was seen taking a call and leaving in the middle of a parliamentary meeting just hours before his successor was sworn in.

"Last night, going to sleep was difficult. I was upset, but now it's not too bad," Purbaya told reporters after a terse handover ceremony at the finance ministry. "Tonight I can sleep soundly."

He said he had partly anticipated the move over a recent decision he took, without elaborating. While he described no policy disagreement with the president, he said his removal was partly linked to differences with other officials.

Purbaya's dismissal came days after he completed one year in the job. His tenure saw the fastest economic growth in three years, but also the widest budget deficit in more than two decades outside the pandemic period, along with credit rating outlook downgrades by Fitch and Moody's.

Capital outflows have intensified this year, pushing the rupiah to an all-time low amid concerns over fiscal profligacy, central bank interference and transparency in capital markets, compounded by global risk aversion linked to the war in the Middle East.

Purbaya, known for his candour, called his tenure "decent", pointing to rising economic growth. He said he would spend his retirement fishing in a pond behind his house.

His replacement, deputy finance minister Suahasil Nazara, used the handover ceremony to call on all stakeholders to open their doors to collaboration. The 55-year-old veteran technocrat pledged to safeguard Indonesia's fiscal credibility and to abide by the legislated fiscal deficit limit of 3% of GDP.

Suahasil is well known to investors and analysts, some of whom said he would likely reassure markets.

Shinta Kamdani, who chairs the Indonesian Employers Association, said Suahasil should provide policy continuity and institutional understanding. "We hope this continuity will help ensure that the leadership transition does not lead to a sudden shift in policy direction," she said.

Kamdani said the business community understood the importance of a healthy budget and its limited fiscal space, but added that government support to bolster growth remained important to maintain purchasing power, boost investment and increase the nation's productivity.

Prabowo's fiscal policies have been under scrutiny since he took power in October 2024 because of costly campaign promises.