On December 18, 2025, Japan’s Finance Minister Satsuki Katayama and Indonesia’s central bank governor Perry Warjiyo signed a landmark memorandum of cooperation to encourage local currency usage in all bilateral transactions between the two nations. This new agreement, which took effect on December 15, 2025, builds on and expands a previous framework signed in late 2019.
The partnership aims to reduce reliance on the U.S. dollar in trade between Japan and Indonesia, promoting the use of their respective currencies — the yen and the rupiah. This move is seen as part of a broader effort to strengthen economic ties and reduce exposure to global currency fluctuations.
The deal highlights both countries’ commitment to enhancing economic cooperation, with Bank Indonesia emphasizing that the agreement will help stabilize financial transactions and support future growth. The implementation of this agreement marks a step forward in the evolving economic relations between Japan and Indonesia, positioning both nations for more resilient financial exchanges.
This agreement is expected to open new doors for other countries to consider similar arrangements, with Japan and Indonesia leading by example in promoting currency diversification in international trade.
