Indonesia, Malaysia, Thailand ink MOU for cross border bilateral transactions

The new framework is expected to synergise with cross-border payment initiatives.

Thailand, Indonesia, and Malaysia are teaming up to promote cross-border bilateral transactions using their local currencies.

Bank Indonesia Governor Perry Warjiyo, Bank Negara Malaysia Governor Abdul Rasheed Ghaffour, and Bank of Thailand Governor Sethaput Suthiwartnarueput inked the memorandum of understandings (MoUs) at the sidelines of the ASEAN Finance Ministers and Central Bank Governors’ Meeting in Indonesia on 25 August.

The new MOUs supercede the MoUs on local currency settlement framework signed between the three central banks on 27 August 2015 and 23 December 2016.

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The new framework is expanded to include more transactions beyond trade, and direct investment. These would be implemented gradually, the three central banks said in a press release. 

The new framework is also expected to synergise with cross-border payment initiatives for more accessible and efficient local currency settlements.

The three central banks said that they are “committed to strengthening cooperation in the use of local currencies for bilateral transactions.”