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Business trends

Widodo tightens grip on Indonesia's state companies

Reformer-in-chief takes a populist turn ahead of upcoming elections

An attendant at a Pertamina gas station in Jakarta. The state-run company's new CEO, Nicke Widyawati, is known as a supporter of Indonesian President Joko Widodo.   © Reuters

JAKARTA -- Once a champion of economic reforms, Indonesian President Joko Widodo is increasingly pushing state-run companies to accept populist demands and avoid rocking the boat ahead of his re-election bid in 2019, raising concerns that they could become bloated and less profitable.

Oil and gas powerhouse Pertamina, one of Indonesia's biggest companies with sales of roughly $43 billion, has become the poster child for this shift. On Wednesday, the government promoted interim CEO and Widodo loyalist Nicke Widyawati to full-time chief.

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