The Indonesian government has urged industrial players to expand the use of local currency transactions for raw material imports to reduce reliance on the U.S. dollar, the Ministry of Industry said Tuesday.
The ministry’s spokesperson Febri Hendri Antoni Arief said that around 24 percent of raw materials used by Indonesian industries still came from imports, making production costs highly vulnerable to exchange rate fluctuations.
He said the move would help ease pressure on the industry caused by the weakening rupiah.
The ministry also urged industries to diversify sources of imported raw materials to reduce global supply-chain risks, while encouraging investors to build domestic facilities for import-substitution raw materials.
Leave a Reply