On June 11, the People’s Bank of China and Bank Indonesia (hereinafter referred to as “Bank Indonesia”) held the second governors’ meeting of the joint working mechanism, marking a new height in cross-border financial cooperation between China and Indonesia.
Pan Gongsheng, Governor of the People’s Bank of China, pointed out at the meeting that China and Indonesia are the world’s second largest economy and ASEAN’s largest economy respectively. The two sides have joined hands to continue to deepen bilateral economic and financial cooperation, which is of great significance to the economic prosperity and financial stability of the region.
In September last year, the People’s Bank of China and the Bank of Indonesia established a joint working mechanism to actively promote bilateral financial cooperation.
This meeting achieved four important results.
First, the People’s Bank of China and the Bank of Indonesia signed a memorandum of cooperation on establishing a RMB clearing arrangement, providing a more convenient channel for currency clearing between the two countries.
Secondly, Pan Gongsheng signed a memorandum of cooperation on local currency settlement (LCT) of trilateral bilateral transactions with Peri Wajiyo, Governor of the Bank of Indonesia, and Yu Weiwen, President of the Hong Kong Monetary Authority.
In 2025, the bilateral trade volume between China and Indonesia will reach approximately US$167 billion. China has been Indonesia’s largest trading partner for 13 consecutive years and has consistently ranked among Indonesia’s top three sources of foreign investment.
Currently, the scale of bilateral local currency swap agreements between China and Indonesia reaches RMB 400 billion.
As the economic, trade and investment exchanges between China and India become increasingly close, the market’s demand for efficient and low-cost payment and settlement solutions is rising. This cooperation memorandum meets the market’s urgent need to reduce exchange rate risks and compress transaction costs.
Perry Vajiyo said that promoting the development of cross-border payment settlement and financial markets will help improve the quality and efficiency of China-Indonesia bilateral trade.
At present, Indonesia’s trade and investment activities can be settled directly in Indonesian rupiah and RMB.
Yu Weiman also said at the meeting that this cooperation is a key step in the development of the offshore RMB ecosystem, which can promote the widespread use of offshore RMB in the region, further consolidate Hong Kong’s status as the world’s major offshore RMB hub, and strengthen Hong Kong’s role as a super connector between mainland China and global markets.
The third result is that under the joint working mechanism, Indonesian Mandiri Bank officially connected to the RMB Cross-border Payment System (CIPS) and became a direct participating bank in the CIPS system.
Since CIPS was launched in October 2015, the circle of friends has continued to expand.
As of the end of March 2026, the CIPS system has 194 direct participants and 1,597 indirect participants, with business covering 191 countries and regions around the world.
As of the end of December 2024, CIPS has processed a total of approximately 600 trillion yuan in various payment services.
In 2024, the cumulative amount of cross-border RMB payment business processed will be 175 trillion yuan, a year-on-year increase of 43%.
The access of Mandili Bank will provide more convenient, efficient and secure RMB settlement services for trade and investment between China and Indonesia.
Finally, China-Indonesia cross-border QR code payment interconnection was also officially launched that day, opening up daily payment channels between the two countries and bringing greater payment convenience to business travelers, merchants and various market entities.
From large-scale trade to daily QR code payment, this all-round cooperation allows ordinary people to truly feel the changes, and it also reflects the steady advancement of the internationalization of the RMB.
The “Central Bank’s Monetary Policy Implementation Report for the First Quarter of 2026” shows that as of the end of March, under the bilateral local currency swap agreement signed by the People’s Bank of China and overseas monetary authorities, overseas monetary authorities had used RMB balances of 111.6 billion yuan.
According to data from the central bank, as of the end of 2025, the People’s Bank of China has signed bilateral local currency swap agreements with central banks or monetary authorities in 32 countries and regions, and overseas central banks or monetary authorities have used 94.2 billion yuan in unexpired balances of RMB.
These data reflect the increasing influence of RMB in the international financial field.
