- Indonesia’s increasing imports from China has led to a deepening domestic CNY liquidity problem, as more imports are now paid in CNY while exports continue to be billed in USD.
- The CNY mismatch problem may lead to more China-backed investments and debt in Indonesia, as the Chinese financial market offer limited opportunities for CNY holder to put their surplus liquidity at home.
- Increasing import payments in CNY and higher exposure to CNY-denominated loans mean that the Indonesian real sector may not benefit from a stronger CNY.
