Indonesia's Trade Balance Surplus 44 Months In A Row, Airlangga: Downstreaming Is The Key

Coordinating Minister for the Economy Airlangga Hartarto (Photo: dock. Antara)

JAKARTA - Indonesia again recorded a trade balance surplus in December 2023 with a value of 3.31 billion US dollars. This figure is a surplus trend since May 2020 or has been going on for 44 consecutive months.

Coordinating Minister for Economic Affairs Airlangga Hartarto said the achievement reflected maintained external resilience amidst the slowdown in the global economy.

Throughout 2023, Indonesia's international trade balance surplus in aggregate reached 36.93 billion US dollars and continued the surplus trend in the last 4 years.

Meanwhile, the impressive performance of the trade balance cannot be separated from the maintenance of Indonesia's export performance amidst the slowdown in the global economy, commodity price fluctuations, and geo-political turmoil that will color 2023.

One of the implementations of the Government's commitment to encourage national export performance is through efforts to diversify export products so that they are not only in the form of commodities but also in manufacturing products.

Airlangga said exports not only rely on primary commodities such as coal, palm oil, iron, steel, but also manufacturing goods such as motorized vehicles and electronic equipment.

"Downstreaming is one of the keys to accelerating the industrial and export sectors, for this reason the Government focuses on creating added value on natural resource commodities such as bauxite, tin, and nickel," he explained in his official statement Thursday, January 18.

The government has provided infrastructure, fiscal incentives, and a conducive industrial business environment to support downstream industries. Smelter investment has demonstrated its ability to drive exports and increase national income.

Furthermore, the Government's efforts to increase added value not only spur export performance, but also create jobs, and maintain economic resilience.

In the future, the Government will also expand on a wider ecosystem such as the manufacture of domestic electric vehicles, especially on battery production.

The government has also provided better market access for Indonesian export products in the international market. Earlier this year, Indonesia has implemented a Mega Free Trade Agreement Regional Comprehensive Economic Partnership (Mega-FTA RCEP) and is currently negotiating the Indo-Pacific Economic Framework (IPEF) and Indonesia European Union Comprehensive Partnership Agreement (I-EU CEPA) to provide better market access in the United States and the European Union.

The government is also reviewing participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CP-TPP) to provide better market access in Latin America.

Currently, the Government has also established a National Export Improvement Task Force that will sharpen a number of export-enhancing strategies, both through increasing the competitiveness of export products, diplomacy, trade promotions, and utilizing international cooperation, ease of licensing and trade facilitation, increasing access to financing for exports, and integration of the national export ecosystem for MSME products.

"Economic growth will also be maintained to remain quality, inclusive, and sustainable in order to ensure medium-long-term economic resilience through several priority policies that have been and will continue to be encouraged," said Airlangga.