Bank & Insurance

Indonesia’s trade gap widens amid falling metal prices

Published : 17 Feb 2020 07:55 PM | Updated : 07 Sep 2020 10:20 PM

Indonesia's trade balance logged a wider deficit in January due to the sluggish metal prices and higher fossil fuel imports, reports Xinhua.

The Central Agency of Statistics announced on Monday that Indonesia posted a trade deficit of 870 million U.S. dollars in January, drifting down from a revised figure of about 60 million U.S. dollars.

Exports edged down by 3.71 percent to 13.41 billion U.S. dollars in January on the year-on-year basis and imports came lower by 4.78 percent to 14.28 billion U.S. dollars, the agency's head Kecuk Suhariyanto said.

The trade balance on the oil and gas sector logged a deficit of 1.18 billion U.S. dollars in January and the prices of commodities such as nickel, copper and tin, drifted lower, Suhariyanto noted.

The termination of nickel shipment abroad also contributed to the decrease in exports, according to him. "The fluctuation of the prices impacted on the value of exports in January," he told a press conference at the agency's headquarters.

The imports of raw materials rose by 1.67 percent in January on the year-on-year basis, but shipment of capital goods from abroad dropped by 8.99 percent, he said.

Commodities are the major exported products from the natural resources-rich country of Indonesia.

The trade balance factors to the country's current account gap which is crucial for rupiah volatility. Indonesia's current account deficit improved to 2.72 percent of the GDP last year, but widened in the final quarter of the year. 

The country's foreign exchange reserve hiked to a record of 131 billion U.S. dollars in January.