JAKARTA – Bank Indonesia (BI) and the People’s Bank of China (PBC) have renewed bilateral currency swap agreement (BCSA), and will be effective for the next 5 years.

Ramdan Denny Prakoso, Executive Director of Department of Communication of BI, mentioned that BCSA renewal will support key policies in the areas of monetary, macroprudential, and payment system, as well as the development of bilateral transactions based on local currencies.

“This agreement is also a part of BI’s mix policy to promote Asta Cita, particularly in maintaining external sector resilience through ensuring the adequacy of foreign exchange reserves,” Prakoso explained, as quoted Monday (10/2).

BCSA has been the primary mechanism in trade and investment transactions in each country’s local currency. For information, this agreement continues a cooperation scheme first initiated on March 23, 2009, and has been renewed a couple of times since then.

This latest extension of BCSA started to take effect last week (31/1), and will be effective for the next five years. Since the last renewal on January 21, 2022, BCSA between BI and PBC has allowed local currency exchanges of up to CNY 250 billion or IDR 550 trillion. (LK/ZH)