Jakarta (VNA) – A senior Indonesian lawmaker has proposed banning gold exports to accelerate the development of a domestic bullion banking system, boost national gold reserves, and better leverage the country’s vast gold resources amid ongoing global economic uncertainties.
Speaking at a recent forum organised by the Institute for Development of Economics and Finance (INDEF) in Jakarta, Mukhamad Misbakhun, Chairman of Commission XI of the House of Representatives, stressed that gold should be treated as a strategic component of national monetary policy.
Indonesia ranks as the world's sixth-largest gold reserve holder, producing an estimated 160 to 200 tonnes annually, mainly through major state-owned enterprises. Despite this, much of the mined gold is held or traded abroad. In 2024 alone, Indonesia exported gold worth 5.4 billion USD while reimporting 2.6 billion USD worth of the metal.
Misbakhun called this a structural paradox and urged the establishment of a robust domestic bullion banking system. He recommended Indonesia adopt global models such as the London Bullion Market Association (LBMA) and the Chicago Mercantile Exchange (CME) to develop a transparent domestic gold trading and regulatory ecosystem.
Earlier in February 2025, President Prabowo Subianto launched Indonesia’s first bullion banking service in collaboration with two state-owned firms - Pegadaian, a subsidiary of Bank Rakyat Indonesia and Bank Syariah Indonesia (BSI). The initiative aims to quintuple gold savings and expand gold-related financial transactions over the next five years.
A bullion bank is a specialised financial institution focused on precious metals, offering services such as gold deposits, trading, financing, and custody, regulated by Indonesia’s Financial Services Authority (OJK).
Minister of State-Owned Enterprises Erick Thohir noted that the bullion banking sector is expected to contribute 245 trillion IDR (15 billion USD) to national GDP and create 1.8 million new jobs across the gold supply chain within five years.
While Indonesia is estimated to have around 2,600 tonnes of gold reserves, the country’s central bank holds just 201 tonnes, below regional neighbour Singapore, which holds 228 tonnes. The proposed shift aims to bridge that gap by retaining more value within the domestic economy and reducing reliance on external gold markets./.
