How Indonesia Chooses a New Central Bank Governor
Jakarta. The resignation of Bank Indonesia Governor Perry Warjiyo has set in motion the legal process for appointing a new central bank chief, with President Prabowo Subianto expected to nominate a successor for parliamentary approval.
Under Law No. 23 of 1999 on Bank Indonesia, as amended by Law No. 4 of 2023, the president may nominate up to three candidates for governor. However, it's very unlikely that the president will propose more than one candidate because it will complicate the selection process in the House of Representatives.
Once the nomination is submitted, the House must decide whether to approve or reject the nominee within one month.
If Parliament rejects the nominee, the president must submit another candidate.
Should Parliament reject the president's nominee twice, the law requires the president either to reappoint the previous governor -- provided the person remains legally eligible -- or promote the Senior Deputy Governor to governor, subject to statutory term-limit provisions.
The governor and deputy governors serve five-year terms and may be reappointed once, allowing a maximum of two consecutive terms.
In Perry's case, reappointment is no longer possible because he resigned voluntarily before completing his second term.
As a result, Senior Deputy Governor Destry Damayanti automatically assumed the role of acting governor and will remain in office until a permanent successor is appointed.
Destry, 62, is serving her second term as senior deputy governor, which is scheduled to expire on Aug. 7, 2029.
She could become the next permanent governor in one of two ways:
- President Prabowo nominates her and Parliament approves the nomination.
- Parliament rejects the president's nominees twice, triggering the legal provision allowing the senior deputy governor to be promoted.
The law also requires the governor and deputy governors to remain independent. They may not hold positions in private companies or other organizations except where required by virtue of their office, nor may they serve as officials or members of political parties.
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