RUPIAH EXCHANGE RATE STRENGTHENING: Businessmen Ready to Diversify Foreign Exchange

JAKARTA - Business players propose a breakthrough scheme to reduce employers' dependence on the US dollar in export-import activities. The trick is to diversify the currency when making international transactions.

Chairperson of the Indonesian Employers' Association (Apindo) Hariyadi B. Sukamdani explained that the exchange rate diversification scheme was carried out in an effort to keep the rupiah exchange rate from being depressed by the US dollar.

According to Hariyadi, the cause of the rupiah continued to be depressed against the US dollar was too much domestic demand for the greenback. On the one hand, importers need US dollars to buy goods. On the other hand, exporters who get US dollars from their sellers are reluctant to convert them to rupiah for various reasons.

"For that we want to make commitments, transactions for export and import to our main export destination countries other than the US - such as to China, Japan, the European Union, Australia and Singapore - will use the currency of the export destination country. "For example, to China, do you use reminbi or the European Union using the euro," he told Bisnis last week.

He said, international transactions that really have to use the US dollar are only with Uncle Sam's country. In addition, other currencies such as the euro, yen and yuan have been recognized as the eyes of global currencies, because they have been included in the International Monetary Fund (IMF) reserve currency basket.

Based on Apindo's data, in the past, the trade value with the Republic of Indonesia and the United States reached US $ 28.27 billion, aka almost one third of the trade value of Indonesia and China in the same period worth US $ 64.33 million

"Because our exports and imports to the US are not too large and not only in that country. Our trade to the US is not as big as China, Japan or the European Union, so why do we hold back or insist on using the US dollar, "said Hariyadi.

He also believes that the plan will get support from the business side. He believes, business people will put forward their nationalism instead of insisting on their ego. For this reason, currently Apindo is actively conducting socialization and discussions with business people and regulators including the government to succeed in the scheme.

When contacted separately, the Director General of Foreign Trade at the Ministry of Trade, Oke Nurwan, said the trade authority supported the plan. According to him, these efforts will help withstand the weakening of the rupiah, which has been accumulated to the government.

"This means that there is awareness from the business community to participate in encouraging trade in the country and controlling the exchange rate. This is a good step, we are ready to accommodate it," he explained. When contacted separately, the Director General of Foreign Trade at the Ministry of Trade, Oke Nurwan, said the trade authority supported the plan. According to him, these efforts will help withstand the weakening of the rupiah, which has been accumulated to the government.