Linda YulismanJ, Jakarta – Indonesia's trade surplus fell further in April as imports reached an all-time high during April thanks to the appreciation of the rupiah against the US dollar, which helped cut the cost of imports, latest trade data shows.
The Central Statistics Agency (BPS) reported on Wednesday that the trade surplus fell to US$1.63 billion in April from $1.81 billion in March and $2.4 billion in February due to the surge in imports.
Imports rose 2.8 percent in April to reach an all-time high of US$14.89 billion as local companies purchased more foreign products to take advantage of the stronger rupiah. Imports rose 32.54 percent compared to April last year.
Monthly exports rose 0.96 percent in April to $16.52 billion from the previous month, a 37.28 percent increase from $12.05 billion in the same month last year.
"Despite still having a surplus in April, we saw a declining trend in monthly exports," BPS deputy chairman of distribution and service statistics Djamal said at a press conference Wednesday.
Standard Chartered economist Eric Sugandi, however, said the declining surplus was normal because the fall was not caused only by the decline in export volume, but was also affected by the appreciation of the rupiah.
The rupiah advanced 0.1 percent to 8,538 per dollar on Wednesday according to data compiled by Bloomberg. The currency touched 8,531 on Tuesday, the strongest level since May 12.
"We estimate that this year's trade surplus will likely further decline from last year as the rupiah continues to strengthen," Eric said.
He added that the surge in imports was not a major concern because most of the imports comprised of raw materials and intermediary goods to support the local manufacturing industry.
"Around 90 percent of imported goods are raw materials and intermediary goods as well as capital goods. It's a consequence of the country's economic growth and the inflows of investments," he said.
BPS data shows that from January to April, imports of raw materials and intermediary goods reached 74.86 percent of total imports, while imports of capital goods contributed 17.16 percent to the figure.
China, Japan and the US remain the main destinations for Indonesia's non-oil and gas exports, which were valued at $1.57 billion, $1.46 billion and $1.31 billion respectively, with a total share of 33.65 percent of total exports.
China held steady as the largest source of non-oil and gas imports, totaling $2.17 billion, or 19.71 percent of total imports. Japan was the second-largest source of imports with $1.33 billion (12.10 percent), followed by Thailand with $904.4 million (8.22 percent).
"We import rice, sugar, fruits and completely built up vehicles, such as the [Toyota] Vios and Yaris models from Thailand," Djamal said.
Indonesia suffered its biggest trade deficit with China at $602 million in April, followed by deficits with Thailand and Australia at $553 million and $166.3 million respectively, Djamal said.