Jakarta, May 22 -- The head of Indonesia's newly formed state wealth fund, Danantara, on Friday defended the appointment of an Australian national to lead its critical natural resources export arm, citing his deep industry ties and local cultural fluency.

Rosan Roeslani, CEO of Danantara, told reporters at the Presidential Palace in Jakarta that Luke Thomas Mahony was selected as president director of PT Danantara Sumber Daya Indonesia (DSI) due to a combination of global commodity expertise and local integration.

"The most important thing is his trading experience, his experience in managing mineral resources, his leadership in many mineral companies, and his network is also strong," Roeslani said, adding that Mahony's qualifications e...