Indonesia Forces Natural Resource Exporters To Keep Earnings Onshore

Indonesia is moving forward with a plan to require natural resource exporters to keep more of their foreign exchange earnings within the country.

Exports from natural resource sectors totaled $166 billion in 2024, accounting for 63% of Indonesia’s total exports.

The initiative, aimed at bolstering central bank reserves by $80 billion and stabilizing the nation’s struggling currency, was reported by Norman Harsono and Grace Sihombing for Bloomberg News.

President Prabowo Subianto last week signed a regulation mandating that exporters across Indonesia’s natural resource industries—including mining, plantations, forestry, and fisheries—retain all of their overseas earnings in the country for one year.

This marks a significant shift from the previous rule, which required companies to keep only 30% of proceeds onshore for at least three months.

The new regulation will take effect in March and is expected to add $80 billion to Indonesia’s foreign exchange reserves this year.

Exports from natural resource sectors totaled $166 billion in 2024, accounting for 63% of Indonesia’s total exports, according to Coordinating Minister for Economic Affairs Airlangga Hartarto.

Oil and gas exporters are exempt from the new rule, Prabowo told reporters.

However, exporters will still be allowed to use their foreign earnings to pay dividends, taxes, and loan payments and to procure raw materials, capital goods, and other essential supplies not readily available locally.

“Natural resource revenues must be optimized for the nation and the people—for development, domestic money circulation, increasing foreign exchange reserves, and strengthening the exchange rate,” Prabowo said.

He added that, until now, “funds have largely been deposited in banks abroad.”