Deprecated Rupiah, Compreonents Mandatory To Attract Debt In Foreign Currency

JAKARTA Bank Indonesia (BI) said that until October 19, 2022, the rupiah exchange rate had been depreciated at 8.03 percent year to date (ytd).

BI Senior Deputy Governor Destry Damayanti said this condition requires the corporate or private sector to be careful in withdrawing foreign debt (ULN) in the form of foreign currency (foreign currency).

Especially if the operating income received is in the form of rupiah.

According to him, the prudent's attitude of corporations has been seen since June 2022. He said the number of private external debt was around US $ 209 billion.

This figure then consistently decreased to 206 billion US dollars in July and fell back to 204 billion US dollars in August.

"This means that from corporations they are more careful in withdrawing foreign debt," he said at a press conference at the BI Board of Governors Meeting, quoted on Friday, October 21.

Destry added that the private external debt payment scheme is quite good because it has a long term nature.

"When viewed from composition, this foreign debt is generally medium-long term with a percentage of 75 percent. Meanwhile, for those with a period of time under one year, it is relatively small," he said.

Furthermore, the BI boss assessed that the structure of private external debt remained safe and was not too affected by the trend of increasing interest rates.

"Their interest rates tend to remain because they were determined before the Fed Fund Rate changes earlier this year," said Destry.

Based on official information released by the central bank, it is known that the dominance of private foreign debt has entered the financial and insurance services sector, the electricity, gas, steam/hot water, and cold air procurement sector, the mining and quarrying sector, and the manufacturing industry sector with a share of 77.5 percent of the total private external debt.