ANNOUNCEMENT 06 Sep 2018
On 6 September 2018, the Indonesian Ministry of Trade issued regulation 94/2018 introducing a letter of credit obligation in four sectors. The move is one of four strategies by the government to halt the slide of the local Rupiah (see Sources and Related State Acts).
NUMBER OF INTERVENTIONS
Ministry of Trade regulation 94/2018 (in Bahasa Indonesia)
Ministry of Trade regulation 102/2018 (in Bahasa Indonesia)
Secondary Source (in English) - overview of the government's strategy to strengthen the Rupiah:
The Ministry of Trade regulation 94/2018 introduces a letter of credit obligation for numerous products in the following four categories:
The letter of credit ought to be issued by an Indonesian bank. According to a press release by the Ministry, the move is meant to increase the inflow of US dollars into Indonesia and thereby help stop the depreciation of the local Rupiah.
The regulation came into force 30 days from its stipulation, i.e. on 7 October 2018.
On 28 September 2018, the Ministry announced the amendment 102/2018, adjusting its previous regulation 94/2018. Compared to the previous list, petroleum and natural gas products (i.e. 6-digit HS codes 270900, 271111, 271112, 271113, 271119, and 271121) were scrapped from the list. The amendment came into force on 7 October 2018 as well. Hence, those 6 products were removed from this intervention.