Indonesian government plans to stop the recent heavy decline of Indonesian rupiah, which slumped to a seven-year record low of 13,150 per US dollar on Friday, by calling on people to sell their dollars and making new regulations to limit the use of dollars in the country.
Boediono, Indonesia's central bank Bank Indonesia governor, was quoted by local daily Indonesia Guoji Ribao on Friday as saying that the rupiah depreciation was caused by lack of dollars on Indonesia's forex market.
Since Bank Indonesia has no plan to use its foreign reserves, Boediono calls on Indonesian people to sell their dollars to the banks, so that the foreign exchange market will remain stable, and the country's real sectors will maintain development.
He was echoed by the Trade Minister Mari Pangestu, who also made an appeal to Indonesian housewives for exchanging their dollars into rupiahs.
But the local economist Anwar was opposed to their appeals, saying the government has to adopt strong measures to drive people to sell dollars instead of just appeals.
Anwar added that Indonesian government should implement foreign currency control policies to keep dollars in the country, ask private and state-owned exporters to deposit their funds in domestic banks, and warn the speculators on the forex market that their behaviors are harmful to Indonesian people.
On the other hand, the newspaper also reported on Friday that Indonesian government is considering making a new regulation to limit the use of dollars in business transactions within the country. It quoted an official with the Indonesian Economic Affairs Ministry as saying that this new policy, which is expected to decrease Indonesia's demand for dollars, will become an efficient step to stop the rupiah depreciation.
(Xinhua News Agency November 21, 2008)
