BI And Central Bank Of Thailand And Malaysia Closely Cooperate On Local Currency Transaction

Head of BI Communications Department Erwin Haryono. (Photo: Doc. Bank Indonesia)

JAKARTA – Bank Indonesia (BI), Bank Negara Malaysia, and Bank of Thailand have agreed to strengthen cooperation to encourage the use of each country's local currency in bilateral transactions or local currency transactions (LCT) between Indonesia and Thailand, Indonesia and Malaysia, as well as Thailand and Malaysia, which have been implemented since 2018.

Head of the BI Communications Department, Erwin Haryono, said that strengthening this cooperation was carried out through expanding the use of local currency in cross-border transactions which is wider than the current scope of trade and direct investment.

"And through synergy with cross-border payment system initiatives to settle transactions in local currency that are more accessible and efficient," he said in a written statement, on Friday, August 25.

Erwin explained that the agreement was realized through a Memorandum of Understanding signing ceremony by the Governor of Bank Indonesia, Perry Warjiyo, the Governor of Bank Negara Malaysia, Abdul Rasheed Ghaffour, and the Governor of the Bank of Thailand, Sethaput Suthiwartnarueput, today on the sidelines of the Meeting of the Minister of Finance and the Governor of the Central Bank 10th ASEAN (AFMGM) in Jakarta, Indonesia.

"This agreement also shows the commitment of Bank Indonesia, Bank Negara Malaysia and the Bank of Thailand to strengthen cooperation in the use of local currency in bilateral transactions between the three countries," he said.

For your information, this collaboration marks a major milestone in strengthening cross-border transactions between Indonesia, Malaysia and Thailand.

"The three central banks believe that this will make a positive contribution to financial market stability and deepening of financial markets in local currencies in the three countries," concluded Erwin.