Herman, Jakarta – Indonesia's exports to several key trading partners, most notably China, dropped significantly to trigger a deficit in January, a poor start to President Joko Widodo's desperate attempt to return the economy to surpluses as the global economic impact from the coronavirus outbreak is expected to hit hard by the end of this month.
The trade balance suffered a deficit of $864.2 million in January due to a $1.18 billion deficit in the oil and gas sector, despite a $320 million surplus in the non-oil sector, according to report from the Central Statistics Agency, or BPS, published on Monday.
Total exports stood at $13.41 billion, down by 7.16 percent from the previous month and by 3.71 percent from January last year. Total imports were valued at $14.28 billion, a decline of 1.6 percent from December and 4.78 percent from January last year.
BPS head Suhariyanto said non-oil exports to China saw the steepest decline on a month-on-month basis.
"Overall, total exports to China fell by 12.07 percent," Suhariyanto told a press conference at his office in Central Jakarta.
Compared to December, exports to China were down by $211.9 million. The next biggest losers were exports to India, Malaysia, Vietnam and South Korea.
However, exports to China rose by 17.23 percent when compared to the same month last year.
China also topped the list of countries from which Indonesia's import fell in January, Suhariyanto said.
China remains Indonesia's biggest non-oil export destination in January, accounting for 16.69 percent of the total, followed by the United States (12.84 percent) and Japan (8.88 percent).
In an attempt to curb oil import, the government introduced the B-30 program this month, obliging a 30 percent mix of locally-made biofuel in diesel fuel products.
President Jokowi said in December the program could save Rp 63 trillion ($4.5 billion) in foreign exchange reserves and tame trade deficit by reducing oil import.
Source: https://jakartaglobe.id/business/slow-trade-with-china-triggers-deficit-in-january