Government Regulation on Foreign Exchange Retention

On March 1, 2025 Indonesia implemented Government Regulation No. 8 of 2025 (GR 8/2025) that mandates certain natural resource exporters to retain 100% of their proceeds in the Indonesian Export Financing Institution. Exporters in sectors such as mining, plantation, forestry, and fisheries must deposit their foreign exchange earnings for twelve (12) months. This provision applies to transactions valued at USD 250,000 or more per export customs notification. Since the oil and gas sector is exempt from this new regulation, Bank Indonesia implemented Regulation No. 3 of 2025 (PBI 3/2025) on March 1 to differentiate export declaration between the oil & gas and other sectors.

With a goal to increase domestic economic benefit from export, the new regulation introduces more stringent provisions compared to the Government Regulation No. 36 of 2023 (GR 36/2023) which required 30% of export proceed retention in the Indonesian banking system for a minimum of three (3) months, except when the proceeds is already deposited in a Rupiah Account. In comparison, GR 8/2025 places clearer restrictions on how retained funds may be utilized.

These regulatory changes signal a strategic effort to improve liquidity and macroeconomic stability. USABC has done series of meetings with relevant officials and is monitoring the upcoming technical regulations since these regulations have raised concerns among relevant U.S. companies. Although not mentioned specifically by Minister Airlangga Hartarto during his press conference regarding the first meeting with to the U.S Commerce Secretary, Indonesian government may need to revisit these stringent measures, especially amid the ongoing U.S. tariff policy negotiations.