BRIN Reveals Several Strategies To Enlarge Indonesia's Trade Surplus

Illustration. (Photo: Doc. Antara)

JAKARTA - Researcher at the Center for Macroeconomics and Finance-National Research and Innovation Agency (BRIN) Ragimun, revealed several strategies to enlarge Indonesia's trade surplus.

"It could be 5-6 percent, if you maximize the process in industrial downstreaming and by increasing exports and reducing imports," said Ragimun, quoted from Antara, Wednesday, September 20.

For example, he explained that in the nickel industry, the manufacture of batteries is the final result desired. However, before becoming a battery, there are nickel ore that can be used to be sold as added value for Indonesian exports in the international market. According to him, this is necessary, considering that the capital for making batteries is very large.

Ragimun further said that trade expansion to non-traditional countries such as Latin America, Africa, and several Asian countries also needed to be carried out, so that Indonesia's market share would be wider.

"In addition to penetration into traditional markets such as Europe, China, and the United States, the government also needs to increase penetration into non-traditional markets," he said.

On the other hand, to get higher trade profits, Ragimun said that reducing the burden of imports must also be done, by maximizing domestic production for certain staples.

According to him, although the production cost and distribution of domestic products are higher, the impact will be felt in a sustainable manner for Indonesia.

"Perhaps domestic commodity prices are more expensive, but don't take a moment of profit from imports, you have to look at them continuously," said Ragimun.

He also said that the allocation of money from trade profits to the real sector must be increased, in order to accelerate the pace of the economy, as well as increase employment opportunities for the community.

Referring to data from the National Central Statistics Agency (BPS), Indonesia's trade balance as of August 2023 was a surplus of 3.12 billion US dollars.

This is the 40th month of Indonesia's successive trade balance surplus since May 2020, with a surplus accumulation obtained since January 2023 reaching 24.34 billion US dollars.