Core Points - The People's Bank of China and Bank Indonesia have launched a bilateral local currency settlement (LCT) framework and a cross-border QR code interoperability project, marking a significant step in financial cooperation between the two countries [1][2] - The LCT framework aims to expand the scope of local currency settlement to all items in the balance of payments, facilitating the use of local currencies in bilateral trade and investment [1][3] - The cross-border QR code interoperability project is set to begin trial operations and is expected to be fully operational by 2025, utilizing local currency settlement methods [1][2] Financial Cooperation - The establishment of the LCT framework and QR code interoperability is seen as a major achievement in China-Indonesia financial cooperation, driven by deepening political trust and growing economic ties [2] - In the first seven months of 2025, the local currency settlement under the LCT framework reached USD 6.23 billion, accounting for 45% of Indonesia's total local currency settlements with all trade partners [2] - Both central banks have agreed to establish a joint working mechanism to enhance the institutionalization of bilateral cooperation and promote deeper financial collaboration [2][3] Previous Agreements - The current LCT framework is an upgrade from a memorandum signed in 2020, expanding the scope of local currency settlement from current account and direct investment to include capital and financial accounts [3] - A bilateral currency swap agreement was renewed with a scale of 400 billion RMB/878 trillion Indonesian Rupiah, effective for five years, which can be extended upon mutual agreement [3][4]