Indonesia logs first trade deficit in six years as imports soar

Key facts

• Indonesia recorded its first trade deficit in six years in May.
• The trade deficit in May was USD 1.61 billion.
• Soaring import values contributed to the trade deficit.
• Higher oil prices were a factor in increased import values.
• A weakening rupiah also contributed to higher import values.
• Indonesia's exports declined in May.
• The nation had maintained trade surpluses for the previous six years.

Indonesia has recorded its first trade deficit in six years, with the shortfall reaching USD 1.61 billion in May. This marks a notable reversal from the consistent trade surpluses the nation had maintained for the past six years. The deficit was primarily driven by a substantial increase in the value of imports. Key factors contributing to this surge in imports include higher global oil prices and the depreciation of the Indonesian rupiah against major currencies. Concurrently, the value of Indonesia's exports saw a decline during the same period. This combination of rising import costs and falling export revenues led to the negative trade balance.