Indonesia and China have built trade and investment relations on a solid foundation of financial cooperation, making the bilateral ties more important.

Jakarta (Indonesia Window) – Indonesia and China continue to strengthen their commitment to using local currency (LCT) in bilateral trade and investment.

This scheme provides concrete benefits for businesses and the public through more efficient transactions, lower conversion costs, and supports financial stability, Bank Indonesia (BI/the central bank) reported on Thursday (Sept. 11).

In the January–July 2025 period, the value of Indonesia–China LCT transactions reached the equivalent of 6.23 billion US dollars, an increase from 2.17 billion dolars in the same period of the previous year.

The achievement in the Indonesia–China LCT cooperation marks an important milestone in commemorating the 75th anniversary of diplomatic relations between the two countries.

This emerged during a meeting between Bank Indonesia Governor Perry Warjiyo and People's Bank of China (PBoC) Governor Pan Gongsheng in Beijing, China, on September 11, 2025.

Governor Perry expressed confidence that business participation and efforts to deepen economic cooperation between Indonesia and China would continue to expand.

"This step reflects a shared commitment to strengthening bilateral collaboration and building a more connected, secure, and inclusive financial ecosystem. Furthermore, Bank Indonesia will continue to work with the PBoC and stakeholders to encourage innovation and expand financial integration," Perry said.

Meanwhile, Governor Pan stated that as two major developing countries in Asia, China and Indonesia share a shared responsibility in addressing current global dynamics.

The trade and investment relationship between the two countries has been built on a solid foundation of financial cooperation, making the bilateral ties more important, Pan said.

The commitment to strengthening LCT with China is also in line with Indonesia's LCT achievements with other partner countries.

During the January–July 2025 period, Indonesia's LCT transactions with other countries also continued to show growth, namely with Malaysia (equivalent to 2.03 billion dollars), Thailand (equivalent to 644 million dollars), Japan (equivalent to 5.08 billion dollars), South Korea (equivalent to 85 million dollars), and the United Arab Emirates (equivalent to 72 million dollars).

On the same occasion, Bank Indonesia and the People's Bank of China (PBoC) also conducted a limited (sandbox) trial of QRIS payment connectivity between Indonesia and China.

The initiative follows through on the commitment of both central banks to strengthen cross-border payment connectivity.

The trial not only marked technological progress but also encouraged inclusion, affordability, and broader access to financial services.

The activity involved the Indonesian Payment Systems Association (locally known as its abbreviation ASPI) and its payment industry partner, UnionPay International, from China.

The implementation of the LCT and QRIS initiatives between the two countries reflects the close synergy between Bank Indonesia, the People's Bank of China (PBoC), payment system associations, and financial institutions of both countries.

The initiative not only strengthens bilateral economic relations but also supports the development of a resilient, inclusive, and competitive digital financial ecosystem in the region.

Reporting by Indonesia Window