UPDATE 1-Indonesia announces looser export earnings rules for US, China exporters
Adds details of announcement
JAKARTA, July 23 (Reuters) - Companies exporting Indonesia's natural resources to the United States, China, Canada and Australia will be treated more leniently in a new earnings retention regime aimed at defending the faltering rupiah currency, chief economic minister Airlangga Hartarto told reporters on Thursday.
Below are the details:
Indonesia had originally mandated that exporters of all the country's natural resources, with the exception of oil and gas, must keep the entirety of their earnings in Indonesian state-owned banks for at least 12 months.
Exporters that are either based in the four countries or ship Indonesian natural resources there, will be allowed to keep a smaller percentage of their earnings inside Indonesia and for a shorter period of time, Airlangga told reporters.
Exporters associated with these countries will need to keep at least 30% of the proceeds for a minimum of three months in the onshore financial system, another ministry official, Edi Prio Pambudi, told reporters.
The earnings retention regime previously included special clauses for miners under bilateral rules or deals with foreign governments, but Jakarta had not announced which countries were eligible.
The rules were designed to increase the supply of foreign exchange in domestic markets and support the falling rupiah.
Under the rules, a maximum of 50% of proceeds from commodity exports can be used for business operations if they are converted into rupiah.
