Imports outside oil and gas fell 7 percent to $12.9 billion in April. (Antara Photo/Aditya Pradana Putra)
Trade Deficit Returns as Machinery Imports Pick Up Pace
MAY 15, 2019
Jakarta. Indonesia's trade balance slumped to a $2.5 billion deficit in April following two consecutive months of surpluses as imports for machinery started to pick up after the country completed its presidential election in April.
Exports fell 13 percent to $12.6 billion last month since last year while imports fell only 6.6 percent to $15.1 billion, the Central Statistics Agency announced on Wednesday.
The Jakarta Composite Index dropped by more than 1 percent on Wednesday following the announcement, continuing a decline since Monday that was fueled by fresh concerns about the continuing trade war between the United States and China.
Non-oil and gas export was down 11 percent to $11.9 billion with coal, palm oil and electronics remaining the country's top three commodities.
China remains the largest export destination, buying up $2.04 billion worth of merchandise from Indonesia. The United States and Japan followed close behind with $1.38 billion and $1.05 billion respectively. Exports to the European Union – with which Indonesia is having a dispute on palm oil-based biofuel – reached $1.16 billion.
Imports outside oil and gas only fell 7 percent to $12.9 billion. Machinery and electrical equipment made up most of imports, accounting for 13 percent of the value of total shipments.
Machinery import was still down in figures compared to last year's but showed a 14 percent improvement since March.
Imports of machinery usually indicate the level of the country's investment activity, which has been seeing a slowdown in the past 12 months.
Data from the Investment Coordinating Board (BKPM) showed investment only grew 5.3 percent to Rp 195 trillion ($13.5 million) in the first three months this year compared to the same period last year. It was the slowest growth pace in the last five years.
China, Japan and Thailand remain the top three sources for Indonesian imports, accounting for almost half of the total shipments.