Value of non-oil and gas exports expected to drop 15%<\/p>\n
JAKARTA (JP): The Association of Indonesian Exporters (GPEI)
\nhas estimated a 15 percent drop in the value of the country's
\nnon-oil and gas exports this year due a deterioration in the
\ncountry's key economic indicators.<\/p>\n
\"In terms of volume, the drop in country's non-oil and gas
\nexports could reach 50 percent in 1999,\" the association said in
\nan assessment report.<\/p>\n
GPEI attributed the estimated sharp drop in non-oil exports to
\na worsening of the country's economic indicators, which were
\nexacerbated by a delay in the disbursement of international loans
\nto the country.<\/p>\n
The association said the delay in the disbursement of the
\nInternational Monetary Fund (IMF) bailout package and the World
\nBank's loan not only hurt the liquidity of the country's payment
\nsystem, but also the country's risk and sovereign ratings.<\/p>\n
The IMF and World Bank suspended loans to Indonesia last month
\nbecause the government refused to release a full report of the
\naudit result on the high-profile Bank Bali scandal, which
\nallegedly involved close aides of President B.J. Habibie.<\/p>\n
The association said the country's poor ratings reflected
\ncontinued uncertainty in the economy, and the government's
\ninability to restore the ailing business climate.<\/p>\n
The lack of confidence had also harmed business transactions
\nwith overseas partners, the association said. \"The reluctance of
\nforeign banks to accept letters of credit from Indonesian banks
\nhurts exporters, because they face difficulties in financing
\nimports of their raw materials,\" he said.<\/p>\n
According to the GPEI data, the value of Indonesia's exports
\nand imports during January and August of this year fell by
\nrespectively 8.18 percent and 13.23 percent.<\/p>\n
\"In terms of volume, Indonesia's exports during the period
\ndropped by 47.2 percent,\" the association said, adding that the
\nexports were lower in terms of value due to an increase in the
\nprice of most non-oil and gas commodities.<\/p>\n
In the period from January to August this year, Indonesia's
\nimport of non-oil commodities declined by 16.13 percent, a figure
\nwhich however was still well above the 34.62 percent decline
\nrecorded in the same period last year.<\/p>\n
In the same period last year the value of non-oil and gas
\nexports dropped by 10.91 percent, resulting in a decline in its
\ncontribution to the country's total exports of 81.53 percent,
\nfrom 83.88 percent in the corresponding period in 1998.<\/p>\n
Indonesia's exports of non-oil commodities reached US$40.97
\nbillion in 1998, a figure lower than 1997's record of $41.82
\nbillion, but higher than 1996's record of $38.09 billion, he
\nsaid.<\/p>\n
Japan remained the largest market for Indonesian exports
\nduring from 1981 to 1998. The value of Indonesia's total exports
\nto Japan during the period amounted to $184.45 billion.<\/p>\n
\"The second largest market for Indonesian export during the
\nperiod was the United States, followed by Singapore, the
\nNetherlands and Hong Kong,\" said GPEI chairman Benny Soetrisno.<\/p>\n
Data from the association showed Indonesia exported goods
\nworth a total of $83.64 billion in value to the United States
\nfrom 1981 to 1998, $53.71 billion to Singapore, $15.43 billion to
\nthe Netherlands and $14.21 billion to Hong Kong.<\/p>\n
The sixth largest market for Indonesian goods during the
\nperiod was Germany with total export values amounting to $13.70
\nbillion, followed by Australia with $11.33 billion, Britain with
\n$10.71 billion, Malaysia with $8.31 billion and Italy with $7.25
\nbillion.<\/p>\n
Benny said the poor ratings given to Indonesia, such as
\ncountry risk and insurance ratings of E-46 and E-20 respectively
\nfor the political and economic sectors clearly indicated
\nIndonesia's poor performance in the eyes of the international
\ntrade and investment community.<\/p>\n
He said to solve the problems Indonesia should gradually stop
\nits dependency on foreign loans by increasing its export capacity
\nand promoting its tourist sector in order to gain foreign
\nexchange. (cst)<\/p>",
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