China, Indonesia sign MoU on local currency settlement in bilateral trade transactions

By Berk Kutay Gokmen

ISTANBUL (AA)— China and Indonesia signed a memorandum of understanding (MoU) on Sunday to create a cooperative framework for local currency settlement in bilateral trade transactions.

The MoU was signed by People's Bank of China (PBC) Governor Pan Gongsheng and Bank Indonesia Governor Perry Warjiyo, the Global Times reported, citing a statement issued by the PBC.

The agreement builds on a previous MoU signed by the two countries' central banks on Sept. 30, 2020, which only covered current account transactions and direct investments.

The PBC said the updated MoU will broaden the scope of cooperation to include capital and financial account settlements.

The agreement aims to encourage the use of local currencies in trade and investment between China and Indonesia, as well as strengthen ties between their monetary and financial markets.

China remains Indonesia’s top trading partner, with bilateral trade continuing to grow steadily.

In 2024, trade between the two countries reached $147.8 billion, marking a 6.1% increase from the previous year, according to data from China’s General Administration of Customs. Chinese exports to Indonesia accounted for $76.7 billion, a 17.6% year-on-year rise.