Ministry of Finance: Trade balance surplus evidence of solid recovery
The Fiscal Policy Agency (BKF) of the Ministry of Finance (Kemenkeu) assesses that the trade balance in December 2021, which recorded a surplus of 1.02 billion US dollars, is evidence that the economic recovery is increasingly maintained and solid.
"Indonesia's trade balance performance throughout 2021 is much better than 2020," said BKF Head Febrio Kacaribu in Jakarta, Tuesday.
On the other hand, the trade balance surplus, which was recorded at 1.02 billion US dollars, decreased compared to the previous month but marked the 20th consecutive month of surplus trend.
The decline in the surplus was due to stronger imports, mainly due to rising domestic demand in line with the strengthening trend in domestic economic activity.
What's more, cumulatively from January to December, which reached 35.34 billion US dollars, was the highest figure for more than a decade.
"Improved global and domestic economic activity and relatively high global commodity prices also contributed to the improvement in trade balance performance throughout 2021," said Febrio.
Meanwhile, Indonesia's exports in December 2021 were recorded at US$22.38 billion or grew compared to the same month the previous year of 35.3 percent.
Throughout 2021, exports increased sharply by 41.8 percent, driven by high growth in both non-oil and gas exports which grew 41.5 percent and oil and gas exports which grew 48.7 percent.
According to Febrio, exports are predicted to remain strong going forward, supported by both global demand and price factors, although commodity prices are expected to begin to moderate.
On the sectoral side, throughout 2021 exports from the manufacturing sector, which is the highest component of total non-oil and gas exports, grew 35.1 percent, followed by the mining sector at 92.1 percent and the agricultural sector at 2.8 percent.
Indonesia's export market share is still dominated by China, the United States (US), Japan and India with the main commodities being mineral fuels, vegetable fats and animal fuels as well as iron and steel.
Then for Indonesian imports, it is recorded at 21.36 billion US dollars, which has increased again compared to the previous month and grew quite high 47.9 percent compared to the same month the previous year.
Throughout 2021, imports also grew by 38.6 percent to record a value of 196.20 billion US dollars and is expected to strengthen further in 2022 in order to support domestic activity which is starting to accelerate.
For the whole of 2021, non-oil and gas import growth is also supported by all types of use, such as consumption goods which grew 37.7 percent, raw materials 42.8 percent and capital goods 20.8 percent.
The increase in imports of raw materials and capital goods reflects an increase in domestic industrial activity, while imports of consumer goods indicate an increase in people's purchasing power.