First trade surplus with Australia

First trade surplus with Australia

JAKARTA (JP): Indonesia booked a surplus of A$1.41 billion
(about US$950 million) in bilateral trade with Australia in 1998,
partly due to a sharp increase in exports to the neighboring
country.

The surplus is the first recorded by Indonesia in the last
five years.

According to data released by the Australian Embassy here on
Wednesday, Indonesia's exports surged 57.2 percent to A$3.56
billion last year while imports dropped by 37 percent to $2.15
billion.

The embassy's economic counselor, Tony Urbanski, said the drop
in imports was caused by difficulties faced by local importers in
securing credit to finance their imports.

Urbanski noted the bilateral trade between both countries
remained relatively stable at A$5.71 billion in value last year
despite the crisis, compared with A$5.65 billion in 1997.

Indonesia's exports of jewelry showed the highest growth last
year, as many Indonesians sold their gold to benefit from the
increase in gold prices in the local market.

The price of gold (in rupiah) surged more than 300 percent
last year due to the plunge in the rupiah's value against the
U.S. dollar.

According to embassy data, jewelry exports from Indonesia to
Australia increased 920 percent to A$471.79 million in 1998.

Gold products, excluding gold ore and concentrate, made a
record increase, rising by 530 percent to A$604.6 million last
year, as against A$95.97 million in the previous year.

Petroleum products and related materials, which are the
country's top export commodities to Australia, reached A$1.22
billion last year, a 9.55 percent increase from $1.11 in the
previous year.

Indonesia also exports paper products, textile yarn,
furniture, wood products, electrical equipment, non-metallic
minerals and apparel and clothing accessories.

Indonesia imports from Australia commodities including
"confidential items of trade", textile fibers, non-ferrous
metals, petroleum products, machinery, metals, dairy products and
bird eggs, iron and steel and electrical machinery.

The "confidential items of trade", which is the largest import
from Australia, dropped by 16 percent to A$696.39 million last
year.

The embassy did not specify what was meant by the
"confidential items of trade" category. But some sources said
they may include items like arms or uranium.

Indonesia's imports of textile fibers from Australia -- the
second largest commodity imported from the country last year --
dropped by 15 percent to A$474.8 million last year.

Embassy trade commissioner Jennie Lloyd said most Australian
businessmen still have confidence in Indonesia's economic future,
citing that "very, very few" Australian companies left the
country amid the economic and political turmoil.

Some new investors are seeking opportunities to invest in the
country and some others have expanded despite the economic and
political turmoil, she added.

"Overall, (Australian) people maintain operations, maintain
relationships and are still very optimistic about the prospect in
Indonesia in the medium term," Lloyd said.

According to Lloyd, more than 400 Australian companies,
including small and medium-size companies, are operating in the
country in various business sectors, including mining, food
products, telecommunications, transportation. (jsk)