Jakarta. Indonesia has posted over $2 billion worth of transactions under the framework of the local currency settlement, also known as the LCS, in the first four months of 2023, according to Bank Indonesia.
This is already half of what Indonesia recorded throughout last year.
The LCS enables countries to conduct bilateral transactions using their own currencies in a bid to cut dependence on the US dollar. For instance, a trade settlement between Indonesia and Japan may use rupiahs, but the rupiah settlement must take place in Indonesia. The same goes for yen if the settlement is conducted in Japan.
Bank Indonesia reported that the value of trade and investment transactions in the local currency with the said four economies had reached $2.1 billion in Jan-April 2023. The transactions mostly came from close neighbor Malaysia during that period.
