ID :
69977
Sun, 07/12/2009 - 00:35
Auther :
Shortlink :
https://www.oananews.org//node/69977
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BI, FINANCE MINISTRY WORKING TOGETHER TO REALIZE BCSA WITH JAPAN
Jakarta, July 11 (ANTARA) - Bank Indonesia (BI) is continuously coordinating with the finance ministry in its effort to realize a bilateral currency swap arrangement (BCSA) with Japan to reduce exchange rate pressures, a BI official said.
So far the exchange rate of the country's rupiah currency against the US dollar continued to fluctuate but with the swap agreement, payments between the two countries would no longer be made in US dollars, Acting BI Governor Miranda S Gultom said here on Saturday.
"Indonesia will no longer need to provide US dollars to pay imports as it could do it with rupiahs while Japan could also pay with its currency. In this way, certainty is assured for businesses and investors to increase trade and investment," she said.
She said Finance Minister Sri Mulyani visited Japan last week to among other things discuss the BCSA. So, the two countries had already agreed about it and the central bank (BI) had just to carry it our and increase coordination about it.
Miranda said Indonesia had already made a BCSA with China and it had even been implemented such as for certain projects like the 10,000 MW electricity development project.
She said Bank Indonesia and the People's Bank of China had agreed on a bilateral currency swap arrangement up to 100 billion renminbi which was equivalent to Rp175 trillion.
She said the BCSA signed by the governor of BI and the governor of the People's Bank of China Zhou Xiaochuan yesterday was effective for three years with possible extension upon agreement by the two sides.
This was what was going to be developed also with Japan, she said.
She said "the swap arrangement could also be used to stabilize money market and exchange rate. So it is not only useful for trade transactions and investment."
Finance Minister Sri Mulyani said earlier that the currency swap agreement was proof of the seriousness of the government and BI in maintaining the stability of the financial and real sectors in the midst of the current economic slowdown.
She said government spending, no matter how big it was, would be useless if the two sectors were not strong. With the swap agreements, Indonesia no longer needed to buy dollars first before trading with China or Japan.
The scheme is meant as a second-tier of defense for foreign exchange reserves, she said.
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So far the exchange rate of the country's rupiah currency against the US dollar continued to fluctuate but with the swap agreement, payments between the two countries would no longer be made in US dollars, Acting BI Governor Miranda S Gultom said here on Saturday.
"Indonesia will no longer need to provide US dollars to pay imports as it could do it with rupiahs while Japan could also pay with its currency. In this way, certainty is assured for businesses and investors to increase trade and investment," she said.
She said Finance Minister Sri Mulyani visited Japan last week to among other things discuss the BCSA. So, the two countries had already agreed about it and the central bank (BI) had just to carry it our and increase coordination about it.
Miranda said Indonesia had already made a BCSA with China and it had even been implemented such as for certain projects like the 10,000 MW electricity development project.
She said Bank Indonesia and the People's Bank of China had agreed on a bilateral currency swap arrangement up to 100 billion renminbi which was equivalent to Rp175 trillion.
She said the BCSA signed by the governor of BI and the governor of the People's Bank of China Zhou Xiaochuan yesterday was effective for three years with possible extension upon agreement by the two sides.
This was what was going to be developed also with Japan, she said.
She said "the swap arrangement could also be used to stabilize money market and exchange rate. So it is not only useful for trade transactions and investment."
Finance Minister Sri Mulyani said earlier that the currency swap agreement was proof of the seriousness of the government and BI in maintaining the stability of the financial and real sectors in the midst of the current economic slowdown.
She said government spending, no matter how big it was, would be useless if the two sectors were not strong. With the swap agreements, Indonesia no longer needed to buy dollars first before trading with China or Japan.
The scheme is meant as a second-tier of defense for foreign exchange reserves, she said.
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