JAKARTA, Aug 19 (Reuters) – Indonesia’s finance minister said on Monday she wants to reduce foreigners’ holdings of government bonds over the near term to 20% from almost 40% currently.
Government data dated Aug. 15 showed non-resident investors held 38.5% of the total 2,613.6 trillion rupiah ($184.06 billion) worth of tradable sovereign bonds.
The high ownership level has at times been a source of volatility in Indonesia’s financial markets, especially during times of heightened risk aversion when foreign investors seek to return to safe-haven assets.
“The bigger our domestic (investor) base, the more stable it would be because they understand our market condition,” Sri Mulyani Indrawati told reporters.
“We hope to reach 20% in the near future and that involves a lot of promotions to new investors,” Indrawati said, adding that her ministry relies on rising demand from Indonesia’s growing middle class.
Her financing department is already seeking funds from new sources of retail investment for new sovereign bonds issues, such as digitally savvy millennials. ($1 = 14,200.0000 rupiah) (Reporting by Maikel Jefriando Writing by Gayatri Suroyo; Editing by Sam Holmes)