Jakarta, CNBC Indonesia – Chairman of the Indonesian Employers Association (Apindo) Hariyadi Sukamdani said Indonesia needed to get out of the comfort zone in terms of using currency when transacting in international trade.
Now when exporting and importing, entrepreneurs can use not only United States (US) dollars, but also local currencies in certain countries that already have Local Currency Settlement (LCS) cooperation.
“Regarding bilateral, we should be able to get out of the comfort zone, it was clear that Mr Yi Gang (Governor of the Central Bank of China) conveyed the benefits of the LCS,” said Hariyadi, in a webinar as part of a series of G20 meetings, Wednesday (16/2/2022).
“As a business actor, I prefer it because it is more efficient,” he said.
According to him, it’s just a matter of how the related parties socialize the benefits or effectiveness of what will be obtained with this LCS.
He sees that currently awareness of LCS is getting higher. Many of the entrepreneurs who are already aware that using LCS is more efficient, it turns out to be more efficient.
“Except for those who don’t have LCS, that’s a different story,” he said.
The implementation of the LCS cooperation itself is one of the central bank’s ongoing efforts to encourage wider use of local currencies in the settlement of trade transactions and direct investment with various partner countries.
The expansion of the use of the LCS is expected to support exchange rate stability through its impact on reducing dependence on certain currencies in the domestic foreign exchange market.
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