Bali Exports Slump, GPEI Says Conditions Resemble COVID-19 Pandemic Era

Statistics Indonesia (BPS) for Bali Province recorded that the island’s export value from January to May 2026 fell 2.55 per cent compared to the same period last year. In January-May 2025, Bali’s export value was recorded at US$242.74 million, while in the same period this year it dropped to US$236.55 million. Several of Bali’s main export destinations also saw declines. The United States, Bali’s largest export market, fell 8.91 per cent. Exports to China plunged the deepest, at 12.30 per cent, while exports to Australia fell 8.27 per cent. On the other hand, some countries recorded increases, such as exports to Thailand which soared 206.20 per cent and exports to France which grew slightly by 1.32 per cent.

The General Chair of the Indonesian Export Companies Association (GPEI) Bali, Anak Agung Ngurah Aditya Pradnyana Sunu, assessed that the current export conditions are almost identical to those during the COVID-19 pandemic. He said the situation is caused by the escalation of conflict in the Middle East accompanied by the closure of the Strait of Hormuz. “If I may describe the export situation in Indonesia, especially Bali, it is exactly the same as the conditions during the pandemic,” Aditya said. According to Aditya, the conflict in the Middle East has disrupted the global energy supply chain, which has resulted in rising logistics costs and basic export costs. “We know that global geopolitical conditions, resulting from the war between Iran and America, have caused the energy supply chain to become very limited. This automatically increases energy costs by 30 to 40 per cent,” he added.

Aditya said the impact of these global conditions is felt by almost all countries. However, he noted that several countries responded more swiftly by implementing state spending cuts and creating crisis policies. In contrast, the Indonesian government was considered late in responding to the global situation. Aditya then touched on the government’s attitude, which initially gave the impression that the situation was still under control. However, when the budget could no longer withstand the pressure, various policies such as fuel price hikes, tax increases, and interest rate rises were implemented simultaneously, making it difficult for business actors. “These kinds of things are full of surprises. This results in unanticipated planning; we are late in making plans. It would have been better from the start to be transparent like other countries, so we can manage competition with other nations,” added the Vice General Chair for Trade at the Bali Chamber of Commerce and Industry.

According to Aditya, the current export slowdown should be a momentum for the government to improve the export ecosystem, for instance by simplifying administrative processes, evaluating unnecessary bureaucratic posts, and addressing dwelling time issues in the logistics sector. “All parties, including entrepreneurs and the government, must start fixing the issues that need to be resolved, the old homework problems, especially in the logistics ecosystem,” he added.

Aditya also highlighted that the strengthening of the US dollar against the rupiah has not provided greater benefits for exporters. He noted that most export industries in Bali still depend on imported raw materials purchased in US dollars. This dependence on imported raw materials occurs across various sectors. The garment industry, for example, still imports thread, buttons, and leather, while the manufacturing sector also relies on machinery and production equipment from abroad. Besides raw materials, logistics costs are also a burden because international shipping transactions also use US dollars. Aditya explained that the rupiah’s depreciation does provide a profit from the exchange rate difference because export payments are in US dollars. However, this profit cannot cover the rising production and logistics costs, which are also paid in dollars. The increase in production costs has also reduced the ability of businesses to purchase raw materials, thus slowing down production activity. Aditya assessed that this condition serves as a reminder that the Indonesian export industry needs to reduce its dependence on imported raw materials by increasing product added value through downstream programmes, provided they are fully supported by technology, tools, raw materials, capital costs, and regulation.