ASEAN Nations Moving to Replace Dollar and Euro Transactions in Favour of Local Currency Swaps
The Association of Southeast Asian Nations (ASEAN) is reportedly looking to shield its transactions from potential geopolitical repercussions and is planning to discuss the possibility of dropping major currencies like the US dollar, euro, yen and pound sterling.
ASEAN is holding an official meeting of finance ministers and central bank governors in Indonesia to discuss this move, as the regional grouping aims to promote economic and security cooperation among its members, which include Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. ASEAN is planning to discuss extending the Local Currency Settlement (LCS) scheme, which has already been implemented between ASEAN members,
to reduce dependence on major currencies through the Local Currency Transaction (LCT) scheme. Additionally, the association plans to expand a digital cross-border payment system that allows member states to use local currencies in trade, which was agreed upon by Indonesia, Malaysia,
Singapore, the Philippines, and Thailand.
This news comes shortly after Indonesian President Joko Widodo urging the nation to to abandon Visa and Mastercard in favour of local local payment systems
