Indonesian government controls foreign exchange, what is the impact?

On February 17th, Indonesian President Prabowo issued Presidential Decree No. 8 of 2025 announcing the Natural Resource Export Exchange Control Policy (DHE SDA).From March 1, 2025, exporters in the mining, plantation, forestry and fisheries sectors are required to deposit 100% of foreign exchange earnings into a special account at the National Bank for a period of 12 months, except for the oil and gas industry, Wang's personal understanding is mainly for is the export of raw materials, it should not be aimed at the deep-processed products, right, and so on the written document out, and then help you to verify it. In addition, for exporters who do not comply with the policy, the government will take sanctions to suspend export services. After the implementation of the policy, it is expected that export earnings will increase by $80 billion in 2025, which, calculated over a 12-month period, means that nearly $100 billion per year will be "locked up" in the local financial system. But make no mistake, this money is not really locked up or frozen, but is forced to be stored for 12 months, and companies will still use this foreign exchange for cross-border procurement settlements, shareholder dividends, or to exchange for rupiah for local business activities.

What are the pros and cons of this policy, Mr. Wang tried to analyze it for you:.

First, for the Indonesian government, under the impetus of this policy, Indonesia's foreign exchange reserves are expected to grow substantially, and export earnings are expected to increase by $80 billion in 2025, which can stabilize Indonesia's economy and exchange rate, and foreign investors do not have to worry about a sharp depreciation of the rupiah, and investment returns are more secure. In order to promote industrial upgrading, Indonesia is likely to increase investment in infrastructure construction, improve transportation, energy supply and other conditions.

Second, for investors, the liquidity of funds will be limited to a certain extent. For example, invested 10 million U.S. dollars to Indonesia's mining projects, after making money this part of the proceeds have to exist in Indonesia's local banks, can not be deployed at will to transfer back to their own countries, but still be able to be used for normal business operations. In addition, non-compliance with the policy will be suspended from export services, such as not in a timely manner in accordance with the requirements of the storage of funds, the export business will be called off, the loss will also be very large. It is expected that exporters related to the palm oil industry, coal industry, bauxite industry, and fishery industry will be greatly affected.

In short, this policy is like a set of combinations of punches, not only to retain the function of export earnings, but also like a magnet to the value of the industry in the local area, to strengthen the Indonesian government's dominance in the export of resources, as well as strengthened the supervision of the financial system in Indonesia. For this policy, what do you think, I am in Indonesia for 20 years Wang Palm, Indonesia Enterprise Pass, help factories efficiently landing in Indonesia.