Megawati seeks to reassure markets

Megawati's new cabinet includes many technocrats

Indonesia's new President, Megawati Sukarnoputri, has announced her long-awaited new cabinet, naming a highly respected economic team that is expected to calm jittery markets.

National unity will be the first priority of my cabinet

Megawati Sukarnoputri

Three of the economic team's four members are technocrats - or professionals - with the outgoing ambassador to the United States, Dorodjatun Kuntoro-Jakti, named top economics minister.

Boediono, a highly respected bureaucrat with a rich background in banking, has been appointed finance minister.

Our correspondent says this is likely to go down well with the markets and international community, both of which were concerned to see a strong economic team which would not be overly hampered by party loyalty.

Currency challenge

Megawati has been careful to include top politicians from all the main parliamentary parties in other positions.

For her, this is vital to ensure the continued support of parliament, which last month impeached her predecessor, Abdurrahman Wahid.

"National unity will be the first priority of my cabinet," Megawati said in a nationally televised address.

She said the cabinet's main economic challenges would be to stabilise the wildly fluctuating currency and restructure the banking sector.

Defence surprise

The government would also work to improve relations with Indonesia's creditors, who are supporting a multi-billion dollar economic rescue program led by the International Monetary Fund.

Former general, Susilo Bambang Yudhoyono, has been appointed chief security minister, one of the cabinet's most powerful positions.

The defence portfolio has surprisingly been given to a civilian, Matori Abdul Djalil.

Mr Djalil was chairman of the party of Mr Wahid, but he deserted him and joined Megawati.

Haggling delay

There had been widespread criticism that more than two weeks after Megawati took office, the country still did not know who would fill Indonesia's top political posts.

Megawati has only just moved into the presidential offices

The delay was blamed on behind-the-scenes haggling between the various political factions that ousted Megawati's predecessor.

Megawati has had to rely on the backing of other parties to win office, because although her party has one-third of the seats in parliament, it still lacks a governing majority.

Our correspondent says her whole approach to leading a nation is expected to be radically different from that of Mr Wahid.

She is acutely aware that if she creates enemies in parliament, she could suffer the same fate as her predecessor.

Earlier this week, the president moved into the presidential palace in Jakarta - her childhood home before her father President Sukarno was deposed in 1965.

A new office has been set up for her in a quiet area of the palace grounds, but she has decided not to live in the accommodation provided within the palace complex.