RI-South Korea Agree To Extend Local Currency Bilateral Swap Agreement

Illustration (Photo: Doc. Antara)

JAKARTA – Bank Indonesia (BI) is said to have reached an agreement with the Central Bank of South Korea (Korsel) to extend bilateral swap agreements in each country's local currency. This information was revealed in a written statement by BI Governor Perry Wajiyo today.

"Bank Indonesia and the Bank of Korea agreed to extend the bilateral swap agreement in each country's local currency or bilateral currency swap arrangement (BCSA)," he said, Monday, March 6.

According to Perry, the BCSA Agreement allows for the exchange of each country's local currency between the two central banks of up to KRW10.7 trillion or IDR 115 trillion.

"This agreement aims to encourage bilateral trade and strengthen financial cooperation that is beneficial for the economic development of Indonesia and South Korea," he said.

Perry added, in particular, cooperation would also support the completion of trade transactions using local currencies between the two countries even in a crisis situation, in order to support regional financial stability.

"The BCSA cooperation agreement between Bank Indonesia and Bank of Korea was first signed in March 2014 and has been extended several times," he said.

Perry explained, the agreement to extend the agreement this time will be effective for three years, from March 6, 2023, to March 5, 2026, and can be extended again based on the agreement of the two central banks.

The Governor of Bank of Korea Chang Yong directly signed the agreement reached with the Governor of BI.

"This agreement reflects the strong economic relations between the two countries, including financial cooperation between the two central banks," he concluded.