Fri, 03 Jan 2003

Exports drop by 23 percent in November says BPS

The Jakarta Post, Jakarta

Exports dropped sharply by 23 percent in November to US$4.1 billion from $5.32 billion in the previous month, the Central Statistics Agency (BPS) reported on Thursday.

The agency did not explain the reasons for the drop, but experts had earlier warned that lingering labor conflicts, and security problems were creating uncertainty that would prompt overseas buyers to shift orders to other countries in the region.

Manufacturers have also complained about various illegal levies and rising production costs at home affecting the competitiveness of their products aboard.

The government is expecting exports to help drive economic growth in 2003, which during the past couple of years had been mainly driven by domestic consumption.

But the sharp fall in the November export value could be strong reminder to the government that without concerted efforts to improve the business climate at home, the country's export performance may continue to weaken, dashing hopes for achieving 4 percent economic growth this year.

External factors are also not in favor of Indonesia's drive to push exports as the economies of the traditionally largest export markets like the U.S., Japan, and Singapore have yet to show signs of recovery.

In fact, BPS said that export to Japan in November declined to 512.7 million.

BPS said non-oil and gas exports dropped to $3.1 billion from $4.2 billion in October.

It said that total exports in the first 11 months declined to $51.92 billion from $52.10 billion a year earlier.

Non-oil and gas exports during the 11 months totaled $41.08 billion, up from $40.33 billion a year earlier.

Elsewhere, BPS said that imports in November declined by more than 8 percent to $2.89 billion from $3.15 billion.

The agency said non-oil and gas imports fell to $2.35 billion from $2.42 billion in October.

Oil and gas imports rose 48.7 percent in November to $541.4 billion from $364 million a year earlier, although it fell 24.8 percent from $720.2 million in October.

The fall in non-oil and gas imports means that the country's manufacturing sector, which is highly dependent on imported raw materials, is slowing down its activity. Earlier reports have said that investment activities had fallen during the year due to various uncertainties at home.

But on a year-on-year basis, imports jumped by 42 percent to $2.89 billion in November compared to the same period last year.

The country's trade surplus declined to $1.21 billion in November from $1.81 billion in the same period last year and from $2.17 billion in October.