▲ Bank of Korea (BOK) Gov. Rhee Chang-yong (R) poses for the camera with his Indonesian counterpart, Perry Warjiyo, on the sidelines of the Finance Ministers and Central Bank Governors Meeting of ASEAN, plus its three Northeast Asian dialogue partners -- South Korea, China and Japan -- in Songdo, west of Seoul, on May 2, 2023, in this file photo provided by the BOK. (PHOTO NOT FOR SALE) (Yonhap)
▲ Bank of Korea (BOK) Gov. Rhee Chang-yong (L) poses for the camera with his Indonesian counterpart, Perry Warjiyo, after agreement on cooperation on local currencies for bilateral transaction in Bali, Indonesia, on Dec. 10, 2023, in this photo provided by the BOK. (PHOTO NOT FOR SALE) (Yonhap)

S Korea-Indonesia-central banks

Central banks of S. Korea, Indonesia agree to implement won-rupiah transactions in 2024

SEOUL, Dec. 10 (Yonhap) -- The Bank of Korea (BOK) and Bank Indonesia agreed Sunday to implement bilateral transactions in their local currencies in a bid to facilitate bilateral trade.

In May, the two banks signed a memorandum of understanding in Seoul to lay out a framework for Korean won-Indonesian rupiah transactions for direct investment, as well as other functions.

The deal was signed by BOK Gov. Rhee Chang-yong and his Indonesian counterpart, Perry Warjiyo.

Sunday's agreement will further facilitate the settlement of trade transactions between Indonesia and South Korea in their local currencies, reducing exposure to exchange rate risks and costs for businesses and other users.

"This will ultimately contribute to promoting trade between Indonesia and Korea, as well as deepening the financial markets in the local currencies in both countries," the two central banks said in a joint statement.

BOK Gov. Rhee said the implementation of the local currency transaction framework, which promotes the use of local currencies in bilateral trade transactions, is expected to positively impact economic development through promoting bilateral trade and also the wider use of the local currency.

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