Representatives of ten ministries and agencies signed an MoU on the sidelines of the ASEAN Summit 2023 in Jakarta witnessed by President Joko Widodo.
Heaptalk, Jakarta — The Indonesian government announced the establishment of a National Task Force for local currency transactions (LCT) with partner countries (09/06).
The formation of the LCT National Task Force aims to encourage the use of local currency in cross-border transactions as an effort to reduce vulnerability to external volatility and deepen financial markets.
In more detail, this Task Force involves ten ministries and agencies, including Bank Indonesia, Coordinating Ministry for Economic Affairs, Coordinating Ministry for Maritime Affairs and Investment, Ministry of Finance, Ministry of Foreign Affairs, Ministry of Industry, Ministry of Trade, Ministry of State -Owned Enterprises, Financial Services Authority (OJK) and Indonesia Deposit Insurance Corporation (IDIC).
On the sidelines of the ASEAN Summit 2023 in Jakarta, representatives of the ministries and agencies signed a memorandum of understanding on Cooperation and Coordination in the framework of Increasing the Use of Local Currency in Transactions between Indonesia and Partner Countries witnessed by President Joko Widodo.
Governor of Bank Indonesia Perry Warjiyo said, “Bank Indonesia is confident that the National LCT Task Force will be an effective coordination forum to strengthen policy synergy between government ministries and agencies in an effort to increase the use of local currencies in bilateral transactions between Indonesia and major trading partners.”
The LCT National Task Force is expected to increase the stability of the Rupiah exchange rate and strengthen the resilience of the domestic financial market. The implementation of local currency transactions is hoped to contribute to export-import activities, investment, and cross-border payment transactions, including cross-border QRIS. Further, LCT can also facilitate securities trading transactions.
Currently, Indonesia has established local currency transaction partnerships with a number of countries in the region, spanning Malaysia, Thailand, Japan, and China. Meanwhile, Singapore and South Korea have obtained a joint agreement to build an implementation framework for LCT cooperation with Indonesia.
