Bank Indonesia calls against payments in US Dollars

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Bank Indonesia has urged importers and exporters to use national currencies in international payments in order to reduce Indonesian financial markets' reliance on the US dollar, according to Tempo.co, an Indonesian news portal.

"About 90% of export-import payments are conducted in US dollars, while the share of Indonesian direct exports to the US is estimated at only 10%, and US imports account for 5%," head of the Solo Bank Indonesia Representative Office, Nugroho Joko Prastowo, told reporters, according to the report.

Prastowo proposed a two-way payment system based on national currencies, claiming that international currency settlements incur a conversion fee, which doubles in dollar payments.

China, Japan, Thailand, and Malaysia have already agreed to use the two-way payment mechanism, with Singapore and the Philippines planning to join the system, according to the economist.

CEO of financial services firm Sovereign Wealth Management, Gary Korolev,  told Sputnik on Thursday that the US dollar is on its way out of being a single reserve currency and will likely compete with the BRICS currency system.

Read next: US dollar may lose dominance due to Russian sanctions: IMF

Russian Foreign Minister Sergey Lavrov, on July 22, said Russian and African partners are working on reducing, though gradually, trade in the US dollar and the euro in mutual trade payments. 

"For sure, the current geopolitical situation requires certain adjustment of the mechanisms of our interaction: first of all, there is a question of ensuring seamless logistics and tuning the system of financial settlements to make them secure from outer interference. In cooperation with its partners, Russia takes steps to enhance the use of national currencies and payment systems. We are working to gradually reduce the share of dollar and euro in mutual trade," Lavrov said in an article to  African outlets, published by the Russian Foreign Ministry.

Russia has long advocated for the establishment of an independent and efficient financial system independent from the SWIFT system that is "proof against the potential impact from the unfriendly States."

Iran official: China, Russia dump of US dollar is 'very good progress'

What is BRICS?

The BRICS group, comprised of emerging economies, always kept among its priorities the security and safety of its energy infrastructure assets, the head of the South Africa-based African Energy Chamber (AEC), Nj Ayuk, told Sputnik on October 12.

"Security of gas and oil infrastructure has been a key priority for BRICS countries for a long time. You have to look at these pipelines because they generate the ability to have energy stability across BRICS nations," Ayuk told the Russian outlet.

BRICS is a group of five emerging economies, Brazil, Russia, India, China, and South Africa, which is an alliance of growing influence in light of the shifting balance of power in the international arena.