Deputy for Coordination of State-Owned Enterprise Management and\nDevelopment in the Coordinating Ministry for Economic Affairs, Ferry\nIrawan, assesses that Indonesia\u2019s trade structure has opened\nopportunities for expanding local currency transactions. This is because\nthe majority of its main trading partners are countries with non-dollar\neconomies.<\/p>\n
He mentioned that the trade surplus of around US$1.27 billion in\nFebruary 2026 was mainly supported by non-oil and gas exports such as\ncoal, palm oil, and iron and steel. Ferry made this statement while\nattending the Bank of China Multilateral Business Dialogue in Jakarta on\nFriday, 10 April 2026.<\/p>\n
\u201cBank Indonesia and the Indonesian Government have jointly advanced\nthe Local Currency Transaction\/LCT framework to diversify bilateral\npayments,\u201d said Ferry, as quoted from an official statement on Saturday,\n11 April 2026.<\/p>\n
In addition to diversifying bilateral payments, LCT is designed to\nincrease market efficiency, deepen financial markets, and reduce\nexchange rate volatility while strengthening economic resilience.<\/p>\n
He explained that the participation of state-owned enterprises is\ncurrently around 10-19 percent of total local currency\/LCT transactions,\nwhich is seen as showing room for expansion. Indonesia\u2019s LCT framework,\naccording to him, has continued to develop since its launch in 2018 and\nhas been utilised in various sectors such as manufacturing, electricity\nand gas, transportation, trade, and services.<\/p>\n
According to Ferry, in 2025 LCT has been implemented with six main\npartners, namely Malaysia, Thailand, Japan, China, South Korea, and the\nUnited Arab Emirates. Bilateral arrangements are said to continue to be\nexpanded to encourage the use of local currencies in regional financial\ncooperation.<\/p>\n
In his explanation, Ferry detailed that the value of LCT transactions\nin January-February 2026 reached around US$8.45 billion, or an increase\ncompared to the same period last year of US$3.21 billion. The number of\nusers recorded was 14,621 in February 2026, with an average of 16,030\nusers per month, higher than the 2025 monthly average of 9,720\nusers.<\/p>\n
In practice, he said, LCT enables cross-border transactions to be\nsettled directly in local currencies without relying on the US dollar.\nThis scheme is supported by Foreign Exchange Administration flexibility,\nmonitoring and supervision mechanisms, and Appointed Cross Currency\nDealers.<\/p>\n
The government, Ferry stated, has also formed the National LCT Task\nForce consisting of 10 ministries and institutions to strengthen policy\ncoordination and accelerate the adoption of local currency transactions,\nespecially for export-import activities. Through this scheme, the\ngovernment is said to be preparing facilities, incentives, and\nsimplified processes for business actors.<\/p>\n
Furthermore, Ferry views the development of LCT as a strategic step\nto increase efficiency, reduce external vulnerabilities, and strengthen\nmultilateral financial cooperation through collaboration between the\ngovernment, financial institutions, and business actors.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/opportunities-for-expanding-local-currency-transactions-increasingly-open-1775911844", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }