Indonesia: Exports and imports continue to nosedive in May
June 24, 2019
According to Statistics Indonesia, the country recorded a trade surplus of USD 0.2 billion in May, contrasting April’s revised USD 2.3 billion deficit (previously reported: USD 2.5 billion deficit). May’s figure confounded market expectations of USD 1.4 billion deficit.
The surprise surplus was largely driven by a huge fall in imports (May: -17.7% yoy; April: -4.7% yoy), amid lower energy and non-energy imports, and government measures to curb the current account deficit. The decline in exports moderated to 9.0% (April: -9.5% yoy). However, exports have now fallen for seven straight months, weighed on by ebbing global trade and lower prices for key commodities.
Looking ahead, exports are likely to pick up some steam in H2 on a more supportive base effect but will remain soft, weighed on by ongoing trade war tensions and slowing global growth. Imports could also recover some ground later this year as infrastructure development gathers pace, but are expected to decline over 2019 as a whole.
Author: Oliver Reynolds, Economist