REPUBLIKA.CO.ID, JAKARTA - Bank Indonesia will continue its cooperation with Bank of Japan through extension of Bilateral Central Swap Agreement (BSA) worth 12 billion USD. Agreement with representatives of Japan Finance Minister will be effective on August 31, 2013 as preemptive action to suppress capital outflow and foreign exchange reserves.

Executive Director of Department of Communication in BI, Difi A Johansyah said foreign exchange reserves were still adequate to face pressures on balance of payments (BOP), but high pressures and global economic uncertainty required anticipatory measures.

"There was a deal before and now we just reactivate it. Both central banks can lend foreign exchange reserves and swap each other," Johansyah said on Friday.

BSA is part of Chiang Mai Initiative. BI and Bank of Japan signed the first agreement in 2003. Extension is needed to guard possibility of further capital outflow which in turn to suppress foreign exchange reserves. Indonesia's foreign exchange reserves reached 92.67 billion USD by the end of July 2013. 

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