Indonesia to Post a Trade Deficit in April
Jakarta. Indonesia is expected to report a trade deficit for April on rising imports amidst slow exports, following two consecutive months of surplus, Governor of Bank Indonesia Agus Martowardojo said on Friday.
"Our economy, in general, is improving, but we need to pay a close attention to our trade balance as it seems we would have a trade deficit for April," Agus told reporters at the central bank headquarter compound in Jakarta.
The Central Statistics Agency (BPS) is due to announce April's trade balance and May's inflation on Monday.
Agus attributed the trade deficit to soaring seasonal imports ahead of the holy month of Ramadan, which will start at the end of next month.
"On the other hand, we saw some challenges in our exports, mainly in some of our major commodities, such as palm oil and coal. Demand from several countries, mainly China, declined," Agus said.
Indonesia's largest trading partner, China reported 7.4 percent economic growth in its first quarter, the country's slowest growth in six quarters.
China mainly imports coal and palm oil from the archipelago, and ships manufactured goods, ranging from clothes and toys to, smart phones and machinery.
Indonesia posted $680 million and $840 million trade surpluses in March and February respectively, both of which contributed to narrowing the country's current- account deficit to $4.2 billion, or approximately 2 percent of first quarter's gross domestic product. That compares to the $4.3 billion deficit, or 2.12 percent of GDP, the country posted in the same period last year.
A narrowing current-account deficit means a country is less dependent on foreign capital for buying the goods and services it lacks.
Meanwhile, the government is watching Indonesia's oil consumption closely, as the country has already managed to utilize nearly 32 percent of its 48 million kiloliter quota in the first four months of this year.
Indonesia now imports more than half of its fuel supply, as 94 percent of its oil fields are tapped dry, but little effort is being made — and even less money being spent — on searching for new, potential sources.
The archipelago imported $2.1 billion worth of fuel more than it exported in this year's first quarter, which further widened the already significant gap in its oil and gas import deficit. Bank Indonesia also blamed the gap on a drastic change in oil production, which dropped from 827,000 barrels per day in the October-December period to 778,000 bpd in January-March.
Posted by: "Sunny" <ambon@tele2.se>
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