Ministry of Finance Welcomes Positive Trade Balance Surplus Amid Risk of Global Slowdown

Illustration (Photo: Doc. Ministry of Finance)

JAKARTA – The Ministry of Finance (Kemenkeu) welcomes the achievement of a trade balance surplus of 3.12 billion US dollars in August 2023.

Head of the Fiscal Policy Agency (BKF) Febrio Kacaribu said the book pushed the cumulative surplus from January - August 2023 to 24.34 billion US dollars.

"Thus, Indonesia has experienced a trade surplus for 40 consecutive months," he said in a written statement on Monday, September 18.

Febro explained that this impressive result was an achievement in itself for Indonesia. The reason is, the Republic of Indonesia (RI) has succeeded in achieving a surplus amidst still high global risks due to falling commodity prices and the slowing world economy.

"This means that Indonesia's resilience is still well maintained and we must continue to maintain this and even increase it," he stressed.

Febrio detailed that exports in August 2023 were recorded at 22.00 billion US dollars, contracting 21.21 percent compared to the same period last year, mainly driven by a decline in exports from all sectors. Cumulatively, exports for the January – August 2023 period reached 171.52 billion US dollars.

Meanwhile, imports in August 2023 were recorded at 18.88 billion US dollars, contracting 14.77 percent year on year (yoy), mainly originating from a decrease in imports of raw/auxiliary materials and capital goods.

Meanwhile, imports of consumer goods still grew by 15.47 percent (yoy). Cumulatively, imports for the January – August 2023 period were recorded at 147.18 billion US dollars.

"The decline in export performance is not only experienced by Indonesia, but also occurs in many countries, due to weakening world economic activity," he added.

It was stated that China and India's exports contracted during January – August 2023. In the ASEAN region, Vietnam's exports also experienced a contraction in the same period. Meanwhile, Malaysia and Thailand experienced contractions in the January – July 2023 period.

"This shows that the impact of the global economic slowdown is widespread," he said.

Febrio added, although Indonesia's export growth in value was moderated, it still showed an increase in volume.

Demand for exports of Indonesia's superior products is still strong, reflected in the growth of non-oil and gas export volumes which are still growing 9.5 percent in the period January – August 2023. Export volumes of mineral fuels include coal, animal or vegetable oils, steel, vehicles, precious metals and nickel, cumulatively from January to August 2023, it will still increase significantly.

Sri Mulyani's subordinate said that in the future Indonesia's export-import performance is expected to remain in a positive trend, although it will slow down slightly in line with moderation in commodity prices and slowing global economic growth.

He said, the sustainability of the mineral downstream stages which continues to be encouraged to be able to support and participate in the global supply chain is also believed to continue to provide significant benefits to the competitiveness and performance of national exports.

"The impact of falling commodity prices and the global economic slowdown, especially from Indonesia's main trading partner countries, is starting to be felt, especially on trade performance. "For this reason, the Government will continue to take anticipatory steps by continuing to encourage the sustainability of downstream Natural Resources (SDA), increasing the competitiveness of national export products, and diversifying main trading partners," concluded Febrio.