Strengthening Relations With China, Accelerating The Enhancement Of Local Currency

Strengthening Relations With China, Accelerating The Enhancement Of Local Currency

Wednesday, 28 May 2025

Bank Indonesia (BI) and the People's Bank of China (PBOC) have signed a strengthened Memorandum of Understanding (MoU) aimed at promoting the enhancement of local currencies in bilateral transactions between Indonesia and China.

The signing of the MoU was conducted by BI Governor Perry Warjiyo and PBOC Governor Pan Gongsheng, with the event being directly witnessed by President Prabowo Subianto and Chinese Premier Li Qiang.

"This Memorandum of Understanding reinforces the previous MoU signed by both central banks on September 30, 2020, by expanding the scope of cooperation in local currency settlement for bilateral transactions, including current transactions, capital transactions, and financial transactions," stated BI Communication Department's Ramdan Denny Prakoso, as quoted on Sunday (May 25, 2025).

Denny explained that this MoU complements efforts to enhance payment connectivity for broader use of local currencies in bilateral transactions.

However, Danny did not specify the details of the transactions permitted under this bilateral agreement. He only mentioned that the transaction details would be outlined in the implementation guidelines agreed upon by both countries.

"This Memorandum of Understanding will further promote the use of local currencies in bilateral transactions and investments, as well as enhance monetary cooperation between the two countries in the monetary and financial markets," he concluded.