THE Bank of Thailand signed three bilateral Memorandums of Understanding (MOUs) with Bank Indonesia (BI) and Bank Negara Malaysia (BNM), with an aim to promote bilateral transactions in local currencies between the said countries.
The new framework will focus on collaborating cross-border payment initiatives for more accessible and efficient local currency settlements.
It also aims to enhance regional financial market stability and deepen local currency markets in the three countries.
The framework has also been expanded to include more eligible cross-border transactions beyond trade and direct investment which would be implemented in a systematic manner.
The deal was signed in the Indonesian Capital Jakarta on the sidelines of the Association of Southeast Asian Nations (ASEAN) Finance Ministers and Central Bank Governors’ Meeting.
The deal comes amid the sudden economic expansion of the Brazil, Russia, India, China and South Africa (BRICS) group and the idea of de-dollarization perceived as a way to counter the dominance of the dollar in global trade resurfaces.
The latest MOUs replaced the previous agreements on the local currency settlement framework signed between the three Central Banks in August 2015 and December 2016.
