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Indonesian President Again Delays Cabinet Announcement - 2001-08-02

For the second time in two weeks, newly-installed Indonesian President Megawati Sukarnoputri has delayed the naming of her cabinet. She had been expected to make the announcement Friday. The delay is causing nervousness in the country's fragile financial markets.

Leaders of Indonesia's main political parties emerged from a breakfast meeting with Ms. Megawati, Thursday, saying the make-up of the coalition cabinet has not been finalized. Although the president did not make an official announcement of the delay, several leaders predicted it could take another week to form a new government.

When she was elected, nearly two weeks ago, by the national assembly to replace defiant-but-scandal-ridden President Abdurrahman Wahid, she promised to name a cabinet "within days." Observers say it now appears the political parties that supported Ms. Megawati in her battle against Mr. Wahid are locked in a fierce battle over the division of ministerial posts.

Asia expert Doug Ramage says the jockeying for position is not surprising, given that the political alliance is a shaky one between the president's party; the former ruling party, Golkar; Muslim conservatives; and the army - among others. "No one has been able to command the resolution of what the cabinet should look like," he says. "You're basically talking about a group of people bargaining over cabinet positions in which all of them are pretty much equal equal in stature, in age, equal in terms of how much backing they have from the Indonesian public. And, I think they are having an awful hard time figuring out who gets what."

The delay is having the most impact on the country's financial markets. The Indonesian currency, the rupiah, began sagging within minutes of the news. Analysts say investors fear the political wrangling may end up in compromises that could undermine the quality of the government.