REPUBLIKA.CO.ID, JAKARTA -- The decision of IMF to make Chinese currency, the yuan, as a global currency could be an opportunity for Indonesia. Trade Minister, Thomas Lembong, said Indonesia has opportunity to increase trade with China.
Currently, he said, China was changing the direction of its economy from production to consumption. Previously, China always used the US dollar for all trade transactions. As a result, China should export to hoard of the US dollars to be used in commercial transactions.
According to Thomas, when the yuan became a global currency, then the pressure of Chinese exports on the wane because China no longer need to hoard of foreign exchange reserves in US dollars.
Read: Minister: Yuan as global currency gives no direct impact to rupiah
"This can actually reduce competition in regional and world exports," Thomas said, in Jakarta, Wednesday (2/12).
He explained that industrial growth in China has been excessive and unhealthy because it raised high levels of pollution. Thus, China would begin to change the direction of economy from production to consumption.
Decision of IMF was actually helping China to be more eager to consume and on the other hand it could be an opportunity for Indonesia to improve the trade balance to China. China needed time to close a number of factories in the country.
"I am optimistic that our trade deficit to China will be reduced and there is opportunity to balance bilateral relationship with China through investment and tourism," Thomas added.
Thomas stated, if China invested to build factories in Indonesia, then it gradually transferred production capacity to Indonesia. This could improve competitiveness of Indonesian products to other countries.
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