Expo to promote export of manufactured goods

Zakki P. Hakim, The Jakarta Post, Jakarta

Following the success of last year, the government will use the 20th annual export exhibition this year to promote products other the "favorites" of furniture, crafts and building materials to international markets, a minister said.

Minister of Trade Mari E. Pangestu said this year's expo, scheduled to take place from Oct. 5 to Oct. 9 at the Jakarta Fairground in Kemayoran, Central Jakarta, would promote other local commodities that have the chance to compete internationally.

"We need to push the exports of our manufactured products, both in volume and value. Many of our products remain unknown in the export markets," she said during a ceremony on Thursday.

The ministry's National Agency for Export Development (Nafed) and expo co-organizers PT Jakarta International Expo and PT Debindomulti Adhiwasti expect this year's sales transactions at the expo to increase by at least 5 percent from last year's record of US$107.70 million.

That figure was 12.7 percent higher than the sales in 2003.

Nafed attributed last year's rise in sales, which was dominated by furniture, handicrafts and building materials, to the increased number of expo participants.

The five-day expo in 2004 was participated in by 1,254 firms and drew 3,164 buyers from 71 countries.

Organizers said that of this week, two-thirds of the 25,000- square-meter venue has been reserved.

Mari said that although recent export growth had been encouraging, it was still led by mineral commodities instead of manufactured goods.

Indonesia's exports grew to an historic high of $69.71 billion last year, up 11.49 percent from 2003, boosted by strong sales of the non-oil and gas commodities of palm oil, electronics, clothing, coal and tin.

The trend has continued this year, with exports in the industrial sector, which account for 66 percent of total exports, expanding by 27.64 percent to $22.5 billion between January and May.

Non-oil and gas exports between January and May rose 34 percent to $26.56 billion from the corresponding period last year.

The ores, slag and ash group claimed the highest increase in the first five months of the year, with exports more than doubling to $1.28 billion from the same period in 2004.

The mineral fuels group, which includes coal, also showed impressive growth of 70 percent, increasing its export value to $1.52 billion.

But the rising exports, which have boosted the trade surplus, have not translated into a stronger rupiah as the currency has weakened against the US dollar since the start of the year.

Analysts said, as confirmed by the central bank, that large chunks of the export proceeds have never made their way into the country's foreign exchange reserves -- which could have helped bolster the rupiah. Instead, they remain stashed abroad, intended by exporters to ensure a quick flow of transactions.

Indonesia's forex reserves as of June 30 stood at $33.87 billion, down $510 million from the previous year.