Indonesia’s Trade Surplus Continues to Expand
According to a press release by the Bank Negara Indonesia, the country’s trade surplus recorded a larger USD3.26 billion surplus in July 2020, increasing from USD1.25 billion in the previous period. Indonesia’s trade balance was primarily boosted by growth of the non-oil and gas trade surplus. Cumulatively from January to July 2020, therefore, Indonesia’s overall trade surplus stood at USD8.75 billion, improving significantly from a USD2.15 billion deficit recorded in the same period one year earlier. Bank Indonesia is confident the current trade surplus will help to maintain external economic resilience in Indonesia. Moving forward, Bank Indonesia will continue to strengthen policy synergy with the Government and other relevant authorities in order to reinforce external resilience, including the trade balance outlook.
By component, the non-oil and gas trade balance recorded a USD3.52 billion surplus in July 2020, up from USD1.36 billion the month earlier. The increase was explained by a surge of non-oil and gas exports coupled with declining non-oil and gas imports in line with compressed domestic demand. The export gains were primarily driven by precious metals, jewellery/gems, animal and vegetable fats and oils, motor vehicles and parts, as well as iron and steel. On the other hand, consumer goods and raw materials were the main drag on non-oil and gas imports despite an uptick recorded in terms of capital goods imports in line with stronger exports. The oil and gas trade deficit persisted in the reporting period at USD0.25 billion as imports of crude oil and refined products increased.
