When the Chinese Economy Becomes the Pride of Indonesia's Trade Deficit
WartaJurnal. Indonesia's trade balance has returned to its end in November 2018. The Central Bureau of Statistics (BPS) recorded a trade deficit in the past month that reached 2.05 billion US dollars, the worst since July 2013. Cumulatively or from January to November, the deficit has reached 7.52 billion US dollar.
Head of BPS Suhariyanto explained, the factors that make the trade balance fall deep enough are the oil and gas deficit which reached 1.5 billion US dollars and non-oil and gas trade of 583 million US dollars.
The cause, he said, is price movements in a number of commodities in October and November.
"The price of Indonesian crude oil fell from 77.56 dollars per barrel in October 2018 to 62.98 dollars per barrel in November 2018," Suhariyanto said in his office on Monday.
While for non-oil and gas commodities, prices of chocolate and gold increased. The price of non-oil and gas commodities that have declined, he said, is kernel oil, palm oil, coal and nickel.
On the other hand, said Suhariyanto, Indonesia's export performance dropped by 6.69 percent to 14.8 billion US dollars compared to October which was recorded at 15.8 billion US dollars.
Export performance is also still fairly bad year on year (yoy). In November 2017, for example, Indonesia's exports were recorded at 15.3 billion US dollars, or greater than 3.28 percent compared to November this year.
Researchers from the Institute for Development of Economies and Finance (Indef) Nailul Huda said the minus export performance was also the impact of the trade war between America and China.
During the period of January to November 2018, said Nailul, China and America were indeed the two largest export destinations in Indonesia, with a total of 22.7 billion US dollars and 16.1 billion US dollars respectively.
However, Nailul said, the demand for the two countries' non-oil and gas sector in November was recorded to decline month-to-month (mtm), which amounted to 369.7 percent to China and 77.3 percent to America.
While November 2018 non-oil and gas exports to 13 destination countries and the European Union (28 countries) only amounted to 13.46 billion US dollars, down 6.25 percent compared to October 2018. While compared to non-oil and gas exports in November 2017, the decline was recorded at 4.12 percent .
"What the government can do regarding trade wars must deal with a shortage of supply of goods both from America and from China. Like CPO, which should be able to fill supply shortages due to the imposition of soybean tariffs from America to China, "said Nailul
Beware of China
Regarding this, Finance Minister Sri Mulyani Indrawati confirmed that the weakening of export performance was indeed caused by external factors.
According to Sri Mulyani, this must be watched out for. Because, he said, "China's economic growth again has adjustments from the internal side or because there is a trade war with the US."
In addition, said Sri Mulyani, there are also export commodities that are indeed sensitive to non-economic issues, resulting in a reduction in demand in European countries.
Seeing the global conditions which are filled with uncertainty, said Sri Mulyani, the government continues to strengthen export competitiveness by providing incentives to exporters so that the trade sector's passion does not weaken.
"Exports are driven by the power of our competition, through various policies to support, such as incentives. But we need to understand, the dynamics of the global market are very high or uncertain," he said.
From the import side, said Sri Mulyani, the government will conduct a more in-depth study of the import reduction policies that have been issued, such as increasing import PPh rates.
"For other sectors, oil and gas and non-oil and gas must continue to pay attention to the ability of domestic industries to produce substitutions, so we remain focused in that portion," Sri Mulyani said.
Head of BPS Suhariyanto explained, the factors that make the trade balance fall deep enough are the oil and gas deficit which reached 1.5 billion US dollars and non-oil and gas trade of 583 million US dollars.
The cause, he said, is price movements in a number of commodities in October and November.
"The price of Indonesian crude oil fell from 77.56 dollars per barrel in October 2018 to 62.98 dollars per barrel in November 2018," Suhariyanto said in his office on Monday.
While for non-oil and gas commodities, prices of chocolate and gold increased. The price of non-oil and gas commodities that have declined, he said, is kernel oil, palm oil, coal and nickel.
On the other hand, said Suhariyanto, Indonesia's export performance dropped by 6.69 percent to 14.8 billion US dollars compared to October which was recorded at 15.8 billion US dollars.
Export performance is also still fairly bad year on year (yoy). In November 2017, for example, Indonesia's exports were recorded at 15.3 billion US dollars, or greater than 3.28 percent compared to November this year.
Researchers from the Institute for Development of Economies and Finance (Indef) Nailul Huda said the minus export performance was also the impact of the trade war between America and China.
During the period of January to November 2018, said Nailul, China and America were indeed the two largest export destinations in Indonesia, with a total of 22.7 billion US dollars and 16.1 billion US dollars respectively.
However, Nailul said, the demand for the two countries' non-oil and gas sector in November was recorded to decline month-to-month (mtm), which amounted to 369.7 percent to China and 77.3 percent to America.
While November 2018 non-oil and gas exports to 13 destination countries and the European Union (28 countries) only amounted to 13.46 billion US dollars, down 6.25 percent compared to October 2018. While compared to non-oil and gas exports in November 2017, the decline was recorded at 4.12 percent .
"What the government can do regarding trade wars must deal with a shortage of supply of goods both from America and from China. Like CPO, which should be able to fill supply shortages due to the imposition of soybean tariffs from America to China, "said Nailul
Beware of China
Regarding this, Finance Minister Sri Mulyani Indrawati confirmed that the weakening of export performance was indeed caused by external factors.
According to Sri Mulyani, this must be watched out for. Because, he said, "China's economic growth again has adjustments from the internal side or because there is a trade war with the US."
In addition, said Sri Mulyani, there are also export commodities that are indeed sensitive to non-economic issues, resulting in a reduction in demand in European countries.
Seeing the global conditions which are filled with uncertainty, said Sri Mulyani, the government continues to strengthen export competitiveness by providing incentives to exporters so that the trade sector's passion does not weaken.
"Exports are driven by the power of our competition, through various policies to support, such as incentives. But we need to understand, the dynamics of the global market are very high or uncertain," he said.
From the import side, said Sri Mulyani, the government will conduct a more in-depth study of the import reduction policies that have been issued, such as increasing import PPh rates.
"For other sectors, oil and gas and non-oil and gas must continue to pay attention to the ability of domestic industries to produce substitutions, so we remain focused in that portion," Sri Mulyani said.
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