Sri Mulyani Indrawati talks about the sweeping reforms she introduced in the Ministry of Finance in Indonesia. She talks about how she took over the Ministry of Finance and built a team that was capable of pushing through challenging reforms. She reflects on the crucial support of Indonesia's president, who backed the tough decisions she needed to make in order to make the Ministry of Finance more effective. She also talks about the complicated relationship between the Ministry of Finance and Parliament, whose members generally supported reform in the abstract but sometimes balked at the steps she felt needed to be taken, such as raising salaries. She notes that the reforms maintained the support of the president and other high-level officials because she kept a close eye on costs and benefits; in fact, tax revenue increased sharply after the beginning of the reforms. In some detail, Mulyani describes the steps she took to tackle corruption. She made it clear that corruption would not be tolerated, and she fired whole departments where corruption occurred, to send the message that she was serious. She was able to contain patronage pressures by securing the president’s backing for decisions that were expected to draw a backlash from powerful people. She also made the tough decision to go against cultural norms and the strong bureaucratic esprit de corps, removing poorly performing bureaucrats rather than relocating them or waiting for them to retire. Throughout these changes, she built a strong and productive relationship with the media, encouraging them to hold her accountable and monitor the activities of her ministry. She ends with reflections on the importance of building coalitions through consultations, and why authority should be exercised only as a last resort.
Sri Mulyani Indrawati received her doctorate in economics from the University of Illinois at Urbana-Champaign. She served as an executive director of the International Monetary Fund, representing 12 economies in Southeast Asia. She worked for the U.S. Agency for International Development and lectured on the Indonesian economy at the University of Georgia, in the U.S. At the time of this interview, she was head of Indonesia's Ministry of Finance, where she build a reputation for integrity and was credited with reducing corruption and increasing efficiency. In August 2008, she was ranked by Forbes Magazine as the 23rd most powerful woman in the world, and the most powerful in Indonesia.