Indonesia’s August trade surplus more than double the forecast despite falling exports

[JAKARTA] Indonesia’s trade surplus in August was more than twice the forecast amount as imports such as capital goods and raw materials fell more than expected.

According to data released by Statistics Indonesia on Friday (Sep 15), the country’s trade surplus came up to US$3.12 billion in August – more than double the US$1.55 billion median forecast of a group of 19 economists polled by Reuters, and far higher than the US$1.31 billion in July.

This was the 40th straight month that Indonesia has posted a trade surplus, with the milestone reached despite the fact that exports fell by 21.2 per cent to US$22 billion, just below the forecast of a 22 per cent decline.

The US$22 billion is the lowest since May 2020, and was due to lower prices for Indonesia’s main commodities such as coal, palm oil and natural gas.

Imports fell by nearly 14.8 per cent to US$18.88 billion, much worse than the forecast of a 9.33 per cent drop. Crude oil imports, meanwhile, fell by about 39 per cent from a year earlier.

Amalia Adininggar Widyasanti, the acting head of Statistics Indonesia, said at a press conference: “This decline continues the trend that has been occurring since the beginning of the year, mainly due to the prices of leading commodities on the global market, which are relatively lower this year compared to last year.”

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The ongoing trade surplus is becoming a less significant pillar of support for the rupiah, analysts noted. Last year, the rupiah received a boost when the trade surplus reached an all-time high of US$7.5 billion.

On Friday, the rupiah fell to its lowest level since March before rebounding slightly. The currency now trades at 15,371 per US dollar, largely unchanged from Thursday and only a shade higher than what it was a month ago.

Indonesia has also taken steps to encourage exporters to keep a portion of their export earnings within the country to improve the availability of the greenback.