KOTA KINABALU: Malaysia and Indonesia should use their respective currency instead of depending on the US currency (USD) when carrying out trade activities with each other as this will help raise the value of the Ringgit and Rupiah.
Chief Minister Datuk Seri Panglima Shafie Haji Apdal urged for the consideration of the proposal by the central government of both countries, citing that the dependence on the USD for trade activities between Malaysia and Indonesia would possibly cause the reduction of the two countries’ currency reserve.
Furthermore, if the trade volume between Indonesia and Malaysia were to increase, more USD would be needed, he said.
“And for me, this is not the best way,” he said, urging the present trade practice between the two nations to be referred to the relevant authority in Kuala Lumpur.
Shafie then mentioned that Indonesia has already begun trading in its own currency with its trading partner, Thailand, which also uses its own currency.
He said this to the media after addressing the Sabah level Sosek Malindo conference which was held in conjunction with North Kalimantan’s governor, Dr H. Irianto Lambrie’s visit to see the chief minister.
Shafie felt that if both Malaysia and Indonesia used their own respective currencies to carry out trade activities with one another, it would help strengthen the value of both the Ringgit and Rupiah.
He added that the proposal should be implemented as an interim measure since the proposal for the use of one currency for the region would not materialise any time soon.
Shafie, who is also Sabah’s Finance Minister, recounted the Sosek Malindo is a platform created 24 years ago to improve trade relations between Malaysia and Indonesia.
He also said the trade relations between North Kalimantan and Sabah must be improved for the benefit of both.
Irianto interjected that leaders in Asean had decided to reduce their country’s dependency on the USD to carry out trade activities within the region.
“The purpose is not merely to strengthen their currency but also to raise the value of their respective currencies,” he said.
He added that the approach had been tested by Indonesia with its trade partner, Thailand last year.
“I hope Indonesia will conduct similar trade relations with Malaysia, Vietnam and other countries in Asia.”
“Of course, US will not be happy with the decision but that is normal.”