Government prepares Panda Bonds issuance in China to strengthen rupiah

Jakarta (ANTARA) - The Indonesian government is preparing plans to issue “Panda Bonds” in China to strengthen the stability of the rupiah’s exchange rate through diversification of international financing sources. “To strengthen the exchange rate, we will also issue ‘Panda Bonds’ in China with lower interest rates so that we are not overly dependent on the dollar anymore. Thus, our diversification will be even better going forward,” said Finance Minister Purbaya Yudhi Sadewa in an official statement from the Press, Media, and Information Bureau (BPMI) of the Presidential Secretariat in Jakarta on Wednesday. Purbaya explained that this diversification step aims to reduce Indonesia’s dependence on the US dollar. The issuance of debt instruments in the Chinese market will also be beneficial as it offers more competitive interest rates for the government. This exchange rate strengthening strategy is the result of discussions in a limited meeting between President Prabowo Subianto and several ministers of the Red and White Cabinet as well as the Financial System Stability Committee (KSSK). In addition to strengthening the rupiah, the government also highlighted the national economic growth achievement that has surged to 5.61%. This figure shows a significant increase compared to the previous period’s achievement of 5.39%. “The economic growth figure released today at 5.61, we discussed with Mr. President that we have indeed been able to reverse the direction of the economy. So, our economy is experiencing acceleration,” said Purbaya. Purbaya revealed that this increase in the growth figure is a positive signal that the direction of the national economy is starting to turn towards a stronger expansion phase. This trend reflects the effectiveness of government policies in driving recovery while accelerating economic growth. This stimulus is planned to begin implementation in early June to encourage community economic activity. “We will maintain it for the second quarter with various policies, coordination with the Central Bank to maintain liquidity conditions, and we will also provide additional stimulus to the economy which will not be long before it is announced, perhaps starting on 1 June,” he said.