Indonesia is taking a bold step toward enhancing its financial stability and economic resilience with the introduction of a new export regulation that is expected to add $80 billion to the nation’s foreign exchange reserves. Signed by President Prabowo Subianto, the regulation requires exporters of natural resources, excluding oil and gas, to retain their earnings locally for at least one year. This move is set to further boost Indonesia’s trade performance and economic development.
Effective March 1, the new regulation aims to ensure that Indonesia’s natural resources contribute directly to national prosperity by promoting a circular flow of money within the country. By keeping export proceeds in local financial institutions, the measure will help increase foreign exchange reserves, stabilize the rupiah, and provide greater opportunities for reinvestment into Indonesia’s growing economy.
The regulation builds upon the 2023 requirement, which mandated that 30% of proceeds from resource exports be kept within Indonesia for transactions over $250,000. However, this new measure expands on that framework by allowing exporters to use the funds for operational needs, such as dividend payments, procurement of materials, or loan repayments, provided they are converted into rupiah. Oil and gas exporters will continue to follow the previous guidelines of depositing 30% of proceeds onshore.
This new regulation reinforces Indonesia’s commitment to creating a robust and sustainable trade environment while ensuring that its resources benefit the local economy and its people.
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