Indonesia to impose ceiling on foreign cash brought into country from next year
JAKARTA: Indonesia will impose a ceiling on how much foreign cash an individual can bring into the country from next year, said a central bank official yesterday.
Under a Bank Indonesia (BI) regulation dated May 5 and effective from March 5 next year, no one except banks and licensed money changers will be allowed to bring in banknotes equivalent to one billion rupiah (RM330,572).
At present, there was no cap on foreign banknotes carried in, though people bringing in the equivalent of more than 100 million rupiah have to declare the amount.
Budianto, BI’s executive director of foreign exchange management, said after the rule took effect, anyone who brought in more than the allowed amount with a licence would have the notes confiscated by the Customs office.
Until the regulation was prepared, Indonesia had “no controlling instrument” on the flow of foreign banknotes.
“The problem is when demand for foreign banknotes increases, it could create pressure on the rupiah.
“And it has psychological effect, too,” said Budianto during a briefing on the new regulation.
He said the measure should strengthen BI’s efforts to ban the use of foreign currency in domestic transactions.
The rupiah, which in the past has weakened significantly, has gained more than one per cent against the US dollar so far this year. Reuters