Airlangga Hartarto Talks of Revised Rule on Export Earnings

TEMPO.CO, Jakarta - Coordinating Minister for the Economy Airlangga Hartarto revealed the reasons why the government planned to amend regulations to lure exporters to keep their foreign-exchange earnings in the country for three months from previously one month.

The government is revising Government Regulation (PP) No. 1 of 2019 on export earnings from natural resources business activities.

“We will prepare the PP. The proposal being discussed is for three months,” Airlangga told reporters at the AA Maramis Building of the Finance Ministry, on Thursday, January 26, 2023.

He explained that the three-month option was chosen considering a number of countries are now facing stagflation or economic slowdown, high inflation, and rising unemployment. The United States also continued to raise its interest rates.

“If the interest rate keeps rising, capital flight will be harmful to us,” said Airlangga.

As an anticipatory step to avoid capital flight, he assessed that sufficient funds are necessary, especially to finance exports and imports.

When the needs of both are fulfilled, the government will then prepare a forex ecosystem at home. “So, entrepreneurs do not only depend on banking in Singapore. The government is preparing infrastructure in the country,” Airlangga explained.

The government is also preparing incentives to prevent foreign exchange earnings from fleeing abroad, especially to Singapore. However, this is still being discussed by the Finance Ministry.

“The incentives will be related to interest or interest income both rupiah and dollars against foreign exchange earnings in Indonesia. We need to do this so we can compete with Singapore,” said Airlangga.

RIRI RAHAYU

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