JAKARTA - Bank Mandiri economist Faisal Rachman estimates that import growth will be higher than exports in 2023, which is driven by strengthening domestic demand.
According to him, domestic demand in 2023 was driven by the lifting of the implementation of restrictions on community activities (PPKM) and the decision to continue the national strategic project (PSN), as received in Jakarta, Friday.
However, Faisal said import growth in 2023 tends to weaken compared to 2022, as oil prices fall and anticipate a decline in exports.
Meanwhile, he said the slowdown in export growth in 2023 was due to a decline in commodity prices, particularly coal, which was driven by sluggish global demand amid rising global economic slowdown risks.
"Although it is projected to shrink, the trade balance surplus can last longer because we see a gradual decline in commodity prices," said Faisal, quoted by Antara, Friday, January 6.
He also estimates that the national foreign exchange reserves will be in the range of 135-140 billion US dollars by the end of 2023 or not too far from 137.2 billion US dollars in December 2022.
"We anticipate that the current account balance will turn into a deficit that can be managed by around 1.10 percent of GDP in 2023 from a surplus estimate of 1.05 percent of GDP in 2022," said Faisal.
Meanwhile, regarding the balance sheet, he estimates that he will face a number of challenges in 2023, but the potential remains to be seen.
Some of these challenges include increasing concerns about the global economic slowdown that could trigger risk-off sentiment in emerging markets, including Indonesia, as investors tend to switch to safe-haven assets.
In addition, the reopening of China's economy could attract investors to look for a portfolio balance in Asia.
However, he said the government's policy to continue to downstream natural resources could attract more direct investment flows to Indonesia.
In addition, continued Faisal, efforts to maintain foreign exchange of export products (DHE) of natural resources can also hinder the placement of assets abroad.
The English, Chinese, Japanese, Arabic, and French versions are automatically generated by the AI. So there may still be inaccuracies in translating, please always see Indonesian as our main language. (system supported by DigitalSiber.id)
