Nasdaq (NASDAQ:NDAQ) and the Indonesia Stock Exchange (IDX) today announced an expansion of their technology partnership which will see IDX upgrade its core trading platform to Nasdaq’s most advanced matching engine.

The deal also includes an extension of Nasdaq’s market surveillance partnership with IDX, and an agreement to enhance IDX’s Index business to help foster a deeper and sophisticated global capital markets ecosystem.

The agreement builds on Nasdaq’s broad range of partnerships across the Indonesian financial system. In addition to Nasdaq’s long-standing relationship with IDX, Nasdaq provides market surveillance technology to OJK, Indonesia’s Financial Services Authority, the core technology platform that underpins KSEI, Indonesia’s central securities depository, and its Calypso treasury solution to Bank Indonesia, the country’s central bank.

Collectively, greater interoperability across the fabric of the Indonesian financial system will reduce overall complexity and friction, ultimately helping to create a more efficient capital markets ecosystem.

The decision by IDX to modernize its underlying architecture is in line with the strategic pillars set out by OJK to develop a robust, stable, and sustainable capital market that can support the ongoing development of the Indonesian economy.

Sunandar, Director of Information Technology and Risk Management at IDX said:

“With this trading system and technology infrastructure upgrade, we envisage becoming more competitive and staying attractive for both domestic and international investors. We believe this partnership will speed up the modernization advancement of the Indonesia capital market while supporting sustainable economic growth.”

Nasdaq’s modular and scalable platform will support IDX’s continued ability to serve Indonesia’s capital market as its economy grows. The platform supports trading in traditional asset classes, including equities, fixed income, foreign exchange, and derivatives, as well as digital assets, providing the flexibility to support IDX’s objective of increasing the number of products and services it offers to clients. In addition, by bringing flexible architecture to the Index business IDX will be able to quickly design and launch new indices as growth opportunities arise. Ultimately, the new platform will quadruple transaction capacity whilst supporting a deterministic low latency trading experience.

Magnus Haglind, Head of Marketplace Technology at Nasdaq said:

“Nasdaq is playing a critical role at the heart of Indonesia’s modernization story. We welcome the opportunity to support Indonesia Stock Exchange’s vision and ambition to become a world-class exchange. By supporting the development of a deep and sophisticated capital markets ecosystem in Indonesia, we can help deliver growth and prosperity across the country and wider region.”