Megawati swears in new team

Analysts have displayed cautious optimism following the cabinet announcement

By staff and wires

JAKARTA, Indonesia -- Indonesian President Megawati Sukarnoputri has sworn in her widely-praised cabinet of technocrats and politicians that some analysts believe has the best chance yet of dragging the country out of crisis.

Wearing a traditional yellow kebaya (dress), a self-assured Megawati urged her ministers to help Indonesia to the rapid growth that made it an economic success story for decades until the Asian financial storm began wreaking havoc in late 1997.

But ministers were reminded of the problems facing them with news that at least 31 people were killed in an attack on a palm oil plantation in troubled Aceh province on Thursday.

Police and separatist rebels have blamed each other for the bloodshed.

Megawati has yet to outline a detailed vision for ruling the unwieldy and often-violent archipelago, but is expected to announce it next week in a national address marking the anniversary of Indonesia's independence. "We hope that all the people of Indonesia give their full support and work together to get us out of this crisis," Megawati said at a solemn swearing-in ceremony attended by a host of political and religious leaders.

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"I'm confident that with support from all over the nation ... Indonesia can return to the (path to prosperity). Let's build a great Indonesia."

Some analysts have pointed out that while the cabinet is a good one, similar euphoria greeted Abdurrahman Wahid's rise as Indonesia's first democratically-elected leader in 1999.

The erratic Muslim cleric quickly stumbled amid the country's immense problems and his rule will be remembered most for the ease with which he made enemies and squandered the political support that swept him to power.

Megawati has been at pains to canvas backing for her coalition cabinet from the parties that combined to oust Wahid three weeks ago for incompetence and thrust her to power.

Those parties have warmly welcomed the cabinet and indicated Megawati will be left alone until her term ends in 2004 if the new government performs well.

Megawati's rise to power and market expectations of a good cabinet have boosted the rupiah more than 20 percent against the dollar. The central bank governor said it could hit 8,000 from the current 9,100 level if the political climate was stable.

Stocks were around one percent higher by midday on Friday.

In a gesture to Indonesian tradition, Megawati has named her team the "gotong royong" cabinet, which means working together and is a phrase frequently used at villages across the nation when people pitch in to help each other.

But Megawati and her government will be tackling woes that have made Indonesia one of Asia's most ungovernable states.

Separatist violence rages in resource-rich Aceh province, communal and ethnic unrest haunts the country's outer reaches while reviving the economy will take years.

Time restraint

Megawati, previously vice president, told her ministers they had only three years to make a difference before her term ends. The daughter of Indonesia's founding father Sukarno is serving out the rest of Wahid's five-year tenure. A general election will follow after that.

Officials had said Megawati might name an attorney-general on Friday after swearing in her team, one of the country's most sensitive posts and vital to efforts to root out endemic graft.

That was now likely next week, they said.

Cabinet members have promised to pull the world's fourth most populous nation from its economic quagmire but the coming weeks will be critical to see whether words translate into action.

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The Jakarta Post daily said the delay in unveiling the cabinet underscored Megawati's efforts to create a dream team. "She asked for a little more time to be able to choose the right people ... And most impressive is that her selections do not reflect any preferential treatment for her own political party interests," it said in an editorial.

Megawati's party is the largest in parliament but does not command a majority. The leading Kompas daily newspaper said new chief economics minister Dorodjatun Kuntjoro-Jakti, the outgoing ambassador to the United States, and Finance Minister Boediono, a former national economic planning chief, made a formidable team.

"The economic team consists of people who are trusted by the economic institutions and international business community," it said.

One of the most important posts and vital to keeping a lid on unrest, the chief political and security portfolio, has gone to well respected ex-general Susilo Bambang Yudhoyono.

Reuters contributed to this report.