Rupiah Redenomination Needs Long Transition Period, President Jokowi Says

President Jokowi, accompanied by Minister of Finance, Cabinet Secretary, as well as the Governor of Bank Indonesia, is responding to the journalists’ questions at the Building of Bank Indonesia, on Monday (19/12) (Picture: Public Relations Office/Jay)

When delivering a remarks at the launching of New Banknotes and Coins of 2016 Emission Year, at Bank Indonesia, Jakarta, on Monday (19/12) morning, the Governor of Bank Indonesia Agus Martowardoyo asked President Joko ‘Jokowi’ Widodo to support the process of Rupiah Redenomination Bill. In this Bill, three zeroes in Rupiah will be slashed off so it will be more simple as well as efficient. This changewould also be followed by an adjustment in prices for goods and/or services.

“Redenomination would not reduce people’s purchasing power. It is not a sanering because it needs an eight-year transition period since the Law of Rupiah Redenomination comes into effect,” Agus said.

With the support from the President, Agus added, Bank Indonesia will cooperate with the Ministry of Finance to finish the Bill.

Needs Seven Years

Responding to this issue, President Jokowi said that Rupiah Redenomination Bill is supposed to be included in the 2017 National Legislation Program (Prolegnas), but it is not. “Later, once the Bill is included in Prolegnas and the House of Representatives has made the decision, it needs a long transition period, at least seven years,” the President said.

By lessening the number of digits in Rupiah so it would be more simple and efficient, when the redenomination applies, the value of Rp1,000 at current currency would become Rp1.(DND/ES)(MMB/YM/Naster)