Iran, Indonesia boost trade, look to promote ‘exchange in national currencies’
Lately, Iran and a number of countries have discussed shifting trade into local currency, coinciding with a global de-dollarization trend
By News Desk - May 23 2023

(Photo credit: Achmad Ibrahim/AP)

During an official visit by Iranian President Ebrahim Raisi to Indonesia on 23 May, the two countries signed an agreement to boost bilateral trade, with both sides stressing the importance of “promoting exchanges in national currencies,” Iranian media reported.

According to Iranian media outlet Press TV, senior officials, in the presence of Raisi and Indonesian President Joko Widodo signed 11 documents on “cooperation in preferential trade, cancellation of visas, cultural exchanges, supervision over pharmaceutical products, science, and technology, as well as oil and gas.”

“The two countries have decided to use national currencies in their trade,” Iranian news outlet Mehr reported, adding that Tehran and Jakarta have vowed to boost the volume of their trade up to $20 billion.

In a joint press conference with his Indonesian counterpart, Raisi hailed 70 years of positive diplomatic relations between Iran and Indonesia, adding that both nations share “common views on regional and international issues,” including on Afghanistan and Palestine.

Raisi also condemned the west’s aggressive sanctions against Iran. Nonetheless, he stressed that these sanctions “have never been able to stop Iran,” and will not hinder it from making strides in science and technology and from improving its relations with fellow Muslim countries and neighboring states.

During the conference, Widodo expressed hope that the agreement “would increase trade between Indonesia and Iran,” according to Reuters.

The agreement comes as Iran has been pushing to de-dollarize its trade with a number of countries in a bid to strengthen local currencies and reduce dependency on the greenback. Other regional states, including Iraq, Algeria, and the UAE, have begun to move down this path.

Iran has begun discussing dumping the dollar with a number of countries, including Russia and India.

This comes as part of a general decrease in the influence of the western economic system, as a result of growing alternatives such as the BRICS+ group of nations and the Chinese-led Shanghai Cooperation Council (SCO), which Iran has officially joined.

While not yet an official member of BRICS+, Iran’s non-oil trade with the group of nations reached $38.43 billion in the fiscal year of 2022-23, according to data released by the Islamic Republic’s Customs Administration earlier this month.

The agreement also comes as Indonesia, as part of its membership in the ASEAN alliance of southeast Asian countries, has also been moving away from the US dollar.

During the 42nd ASEAN summit earlier this month, Indonesia and other member states signed an agreement for “better regional payment connectivity and the use of local currency transactions,” in a move “seen as the bloc’s strategy to transition away from established currencies … such as the US dollar.”

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