Indonesia: Merchandise exports increase at a softer pace in December
Merchandise exports soared 35.3% in annual terms in December, on the heels of November’s 49.7% upturn. December’s result marked the slowest expansion since March. Meanwhile, merchandise imports climbed 47.9% on an annual basis in December (November: +52.6% yoy).
As a result, the merchandise trade balance deteriorated from the previous month, recording a USD 1.0 billion surplus in December (November 2021: USD 3.5 billion surplus; December 2020: USD 2.1 surplus). Lastly, the trend pointed down, with the 12-month trailing merchandise trade balance recording a USD 35.3 billion surplus in December, compared to the USD 36.4 billion surplus in November.
Commenting on the release, Nicholas Mapa, senior economist at ING, stated:
“Indonesia’s economy continues to gradually reopen, suggesting that import growth will likely be sustained into 2022. On the other hand, exports may dip in January, after a temporary export ban on coal was implemented in January to address domestic supply concerns. Should the trend of surging imports and disappointing export growth continue, we can expect the trade balance to dip below the highs noted last year. A fading trade surplus suggests that support for the IDR may wane in 2022, with the currency likely coming under pressure as the Fed readies its projected rate hike cycle.”