Indonesia and Japan Extend US$22.7 Billion Swap

Indonesia and Japan extend bilateral swap agreement for the next three years.

Jakarta, 13 Rabiul Awwal 1438/13 December 2016 (MINA) – Bank Indonesia (BI), the bank central,, and Bank of Japan (BoJ) agreed to extend a bilateral US$22.76 billion swap arrangement (BSA) for the next three years.

Under the swap cooperation, agreement Indonesia could overcome possible short term liquidity problem in financing, Antara News quoted Bank Indonesia as saying here on Monday.

“This (arrangement) is also to sustain the regional financial stability amid continued uncertainty in the global financial market,” Bank Indonesia Governor Agus Martowardojo said after the signing of the swap cooperation agreement with Bank of Japan .

Swap is a derivative instrument. With the bilateral cooperation, both parties could exchange cash flow to prevent risk of liquidity problem in financial system.

Cooperation between Indonesia and Japan constitutes US dollar and rupiah swap partnership.

The first time Indonesia and Japan agreed on swap arrangement was on 17 February 2003 which was extended until December 2013, and again until 12 December 2016.

Under the new agreement the swap cooperation is extended further until 2019. (T/R07/R01)

Mi’raj Islamic News Agency (MINA)