In­done­sia to im­pose ceil­ing on for­eign cash brought into coun­try from next year

New Straits Times - - Business -

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

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