Trade Minister: Indonesia and Philippines exploring barter scheme amid currency weakening

The Minister of Trade, Budi Santoso, stated that Indonesia is preparing a trade cooperation arrangement with the Philippines through a barter scheme as an alternative transaction method amidst the exchange rate challenges faced by both nations. This was conveyed by Budi in response to queries regarding the weakening of the Rupiah in foreign trade at the Ministry of Trade office in Jakarta on Wednesday.

“We have an alternative, for example, using barter. On 12 June, we will meet with Filipino entrepreneurs,” said Budi. He noted that this plan is a follow-up to his meeting with a Filipino entrepreneur during the ASEAN Joint Foreign and Economic Ministers (AMM-AEM) meeting in Cebu, Philippines, recently. According to the Minister, the entrepreneur, who imports Indonesian products, proposed the use of a barter mechanism to simplify trade.

Furthermore, both Indonesia and the Philippines are experiencing a depreciation of their respective currencies against the US dollar, making the proposal a viable new alternative. The Ministry of Trade has followed up on this proposal by identifying suitable buyers. Budi mentioned that buyers for this cooperation have already been found, and the signing of contracts is planned for 12 June.

While he did not disclose the specific commodities to be traded under this scheme, Budi ensured that the details of the cooperation would be announced during the contract signing. Regarding the impact of currency weakness on food prices and imported raw materials, Budi stated that the government continues to monitor distribution and supply to ensure that the needs of both industry and the public remain met.