Indonesia’s trade surplus in December at $1 billion, well below forecasts

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A tugboat is seen docking at Tanjung Priok port in Jakarta, Indonesia January 11, 2021. Picture taken January 11, 2021. REUTERS/Willy Kurniawan

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  • December imports at a record high of $21.36 billion
  • December exports to $22.38 billion as growth slows
  • January coal export ban affects trade balance
  • Trade surplus of $35.3 billion in 2021, largest since 2007

JAKARTA, Jan 17 (Reuters) – Indonesia’s trade surplus narrowed more than expected in December to $1.02 billion, the lowest in 20 months, as a rise in exports led by materials raw materials slowed and imports hit a record high, official data showed on Monday.

Southeast Asia’s largest economy has recorded a trade surplus every month since May 2020, as the coronavirus pandemic suppressed local demand while exports rocketed prices of commodities like coal, oil palm oil, copper, tin, steel and rubber.

December’s surplus was about a third of the $3.13 billion forecast by economists polled by Reuters and was also well below the $3.51 billion recorded in November.

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December imports hit a record $21.36 billion, up 47.93% year on year and beating survey forecasts for 39.40% growth, as of everything from consumer goods to raw materials for manufacturing industry have surged.

“It shows that economic activity is improving…including consumption,” Margo Yuwono, head of Statistics Indonesia, told a news conference.

Meanwhile, export growth was 35.30% on an annual basis compared to the survey’s growth expectations of 40.40%, as coal shipments to China slowed as Beijing ramped up domestic fuel production.

Total shipments from the resource-rich country in December stood at $22.38 billion, the second highest on record for the monthly data after November’s $22.84 billion.

Economists have warned that a ban on coal exports, put in place since January 1 to avoid widespread power cuts, could tip Indonesia’s trade balance into deficit. Coal exports account for about 14% of Indonesia’s total exports.

The ban has been relaxed for large miners who have met domestic sales requirements, but still affects small miners whose production accounts for up to 40% of Indonesia’s total.

For the whole of 2021, Indonesia’s exports hit a record high of $231.54 billion, while imports totaled $196.2 billion.

The trade surplus of $35.34 billion in 2021 was the largest since 2007.

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Reporting by Gayatri Suroyo and Fransiska Nangoy; Editing by Martin Petty and Ed Davies

Our standards: The Thomson Reuters Trust Principles.

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