"This will be a milestone in the regional central banks` cooperation," Tirta Segara, executive director of Bank Indonesia`s Department of Communication, said. .Jakarta (ANTARA News) - Central banks of Indonesia, Malaysia, and Thailand have signed a memorandum of understanding on trade settlement and direct investments using local currencies to reduce dependence on the US dollar.
"In the long term, the cooperation agreement will be positive for trade and investment in Southeast Asia. This is also done in the framework of reducing dependence on the US dollar," Bank Indonesia Deputy Senior Governor Mirza Adityaswara said here on Friday.
The agreement was signed in Bangkok, Thailand, by Governor of Bank Indonesia Agus Martowardojo, Governor of Bank Negara Malaysia Muhammad bin Ibrahim, and Governor of Bank of Thailand Veerathai Santiprabhob.
The agreement will give more options to business players in choosing the currencies they wish to use during transactions, Tirta Segara, executive director of Bank Indonesias Department of Communication, said.
So, the use of local currencies in the Association of Southeast Asian Nations may increase, thus reducing risks in the midst of global financial market volatility, he said.
"This will benefit business players in that it will reduce transaction cost and increase trade efficiency and investment," he said.
The agreement will also spur the development of the regional financial market to support financial and economic integration, Tirta said.
"This will be a milestone in the regional central banks cooperation," he said.
To reduce dependence on the US dollar, Indonesia had earlier established bilateral currency swap agreements with several countries including China and Australia.(*)
Editor: Heru Purwanto
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