All domestic transactions 'must be done' in rupiah

JAKARTA (JP): The Indonesian Chamber of Commerce and Industry has urged the government to require all domestic business transactions to be done in rupiah.

"The government needs to rule that all services and goods offered domestically be priced in rupiah instead of foreign currencies," Aburizal Bakrie was quoted by the daily Bisnis Indonesia as saying.

"The government must make the rupiah the only valid currency for domestic transactions," he said.

The measure would reduce dependency on the U.S. dollar, he said.

It would also boost demand for the rupiah and would ease the currency crisis caused by the loss of confidence in the rupiah.

"Malaysia uses the ringgit, Japan uses the yen and Thailand uses the baht.

"Why... do we still use the dollar?" he asked.

Rental of retail space, shops in the shopping centers and some apartments and houses are some transactions quoted in dollars.

The dollar is also used at hotels, some private schools and legal services.

The U.S. dollar has more than doubled its value against the rupiah since July.

Late last year, the finance minister said the government did not prohibit businesses from using the dollar as a base for local transactions as long as payments could be made in rupiah.

The Indonesian Association of Retailers has complained that the use of the dollar for retail rental space has burdened companies.

The rising dollar has also put pressure on publishing companies, as it more than doubled the price of newsprint, the raw material of newspapers, which are sold in rupiah. (das)