Exports up but key products down

Exports up but key products down

Tony Hotland, The Jakarta Post/Jakarta

Indonesia's export performance remained positive in August thanks
to the rising prices of oil and commodities, the Central
Statistics Agency (BPS) reported on Friday.

But a closer look at the BPS data suggests the current surge
in oil prices has begun to take a toll on some of the country's
main non-oil and gas export products, particularly to the key
U.S. market.

Analysts have said the U.S. economy could be hurt by rising
oil prices, which in turn would reduce its imports from
developing countries like Indonesia.

The BPS said that exports in August reached US$5.91 billion, a
4.15 percent increase from the previous month and a 17.66 percent
rise from the same month last year.

Non-oil and gas exports rose by 3.42 percent to $4.60 billion
month-on-month, with ores, slags, and metal ashes recording the
largest jump, reaching a combined value of $209.2 million from
$92.1 million in July.

Oil and gas exports were up by 6.79 percent to $1.31 billion.
The increase in oil and gas exports was attributed to soaring
global oil prices, which rose to $42.61 per barrel from $37.1 per
barrel in July. However, export volume declined by 10.26 percent.

Exports in the January-August period totaled $43.09 billion, a
5.75 percent increase from the same period last year.

But the agency's data also revealed that some non-oil and gas
export products like wood and wood-based products, rubber and
rubber-based products, non-knitted clothing, and
machinery/mechanical appliances suffered a drop in export value,
by 77.7 percent, 69.7 percent, 46.1 percent and 35 percent,
respectively.

The BPS also reported that exports to the U.S. market dropped
by 63.1 percent in August to $710 million, although it remained
Indonesia's second largest export market after Japan. The other
major destinations were Singapore and China.

Oil prices have surged by about 55 percent this year. There
are fears that the high oil prices, recently reaching a record
level of more than $50 per barrel, will undermine exports from
Asia's manufacturers to developed nations, as companies cut back
on their investments and consumers stop impulse purchases amid
threats of an economic slowdown.

Boosting export performance is crucial for Indonesia to push
economic growth higher than the average 4 percent posted during
the past few years. This year, the government expects the economy
to expand by 4.8 percent, and by about 5.5 percent next year on
improvements in exports and robust domestic consumption.

Meanwhile, imports jumped by 49 percent in August to $4.02
billion from $2.70 billion in the same month last year, but were
down 2.2 percent from $4.11 billion in July.

The country's trade surplus increased slightly to $1.89
billion during the month from $1.57 billion in July, but dropped
sharply from $2.66 billion in August last year.