Global crisis cuts massive chunk from export figures

The Jakarta Post , JAKARTA

The country is getting pummelled by the global economic meltdown, with December exports plunging 20 percent from a year earlier as overseas demand shrinks.

December exports were also down 9.97 percent from the previous month, the Central Statistics Agency (BPS) said Monday.

The decline in monthly and yearly figures overshadow a 20 percent rise in full-year exports from 2007, with exports continuing to take a beating in the last three months of the year, just as the global financial crisis began unfolding.

With the downturn slashing demand and contributing further to the already plummeting prices of key global commodities, Indonesia’s exports decreased by 9.57 percent to US$8.7 billion in December, from $9.6 billion in the previous month.

Non-oil and gas exports, which constituted almost 80 percent of total exports, were down by8.84 percent to $7.45 billion. The year-on-year figures show a larger decrease in non-oil and gas exports of 11.59 percent.

“The largest decrease in non-oil and gas exports is that of animal or organic fat and oil exports, down to $835 million from $1.2 billion,” BPS deputy chairman Ali Rosidi said at a press conference.

“On the other hand, ores, iron slag and metal dust exports recorded the largest increase, up by $191 million."

Oil and gas exports also slowed in December from the previous month by 13.69 percent, down to $1.2 billion from $1.4 billion.

Crude oil exports decreased to $455.5 million from $484.6 million, processed oil decreased much more drastically — down 58.19 percent to $96.8 million from $231.5 million — while gas exports dropped to $691.4 million from $724.8 million.

Non-oil and gas exports to Japan decreased to $1 billion in December from $1.1 billion in November, while to the United States they dropped to $907 million from $935.2 million. Exports to these two countries contributed almost 25 percent to Indonesia's total non-oil and gas exports.

The IMF has said Japan and the US economies may shrink by 2 percent this year.

The domestic outlook remains bleak as well, with exports very likely to plunge further as the world is tipped into recession.

Economists predict the impacts of the global turmoil will likely hit the local market the hardest by mid-2009.

“Exports have been declining since October, and the year-on-year figure also shows the same trend," Rosidi said.

"However, we still managed to record a surplus in the trade balance."

The country notched up total exports in 2008 of $136.76 billion, almost 20 percent higher than the $114.1 billion recorded the previous year. However, the trade surplus stood at $8 billion, 80 percent lower than the surplus of $40 billion recorded in 2007.

The declining surplus reflects a sharp rise in imports, valued at $128 billion in 2008, compared to $74 billion in the previous year.