Trade Balance of Indonesia: Relatively Small Trade Surplus in November 2023 as Exports Decline
Although Indonesia enjoyed another comfortable trade surplus in November 2023, the surplus ranks among its weakest in 2023 as exports dipped, while imports were rather stable. The latest trade surplus, which is the country’s 43rd consecutive trade surplus, reached a value of USD $2.41 billion.
As usual, before we delve into Indonesia’s latest export and import statistics, let’s first take a quick look at the international trade environment.
International Trade
On 11 December 2023, the United Nations Conference on Trade and Development (UNCTAD) released its latest Global Trade Update. In this update, UNCTAD projects global trade to contract by 5 percent in value in 2023 (compared to the preceding year).
However, although international trade is expected to contract in terms of value (by USD $1.5 trillion) in 2023, UNCTAD did detect a slight increase in trade volumes this year, suggesting resilient global demand. In fact, it projects a USD $500 billion rise in trade in services. This sector grew by seven percent in 2023 thanks, in part, to a delayed COVID-19 recovery. Also, some developing economies, particularly Mexico and some East Asian countries, have had opportunities to better integrate the supply chains affected by geopolitical concerns.
That global trade declined in value, but rose in terms of volume is largely due to the decline in commodity prices (after having peaked in 2020-2021 when the recovery from the COVID-19 crisis kicked in).
Meanwhile, the outlook for 2024 remains highly uncertain and generally in fact quite pessimistic amid the ongoing geopolitical tensions, escalating debt, and widespread economic fragility. Other elements weighing on global trade include lower demand in the developed countries, less trade in East Asia, some commodity price volatility, an uptick in trade-restrictive measures, and lengthening supply chains, particularly between China and the United States (US).
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This is the introduction of the article. The full article can be found in the December 2023 edition of our monthly report (an electronic report, PDF). This report can be ordered by sending an email to info@indonesia-investments.com or a message to +62.882.9875.1125 (including WhatsApp).
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