Restoring the Interrupted Surplus Trend
Indonesia’s 72-month trade surplus streak, unbroken since May 2020, came to an end in May 2026. The nation’s trade balance recorded a deficit of US$1.61 billion, with exports valued at US$23.20 billion and imports reaching US$24.81 billion. In June 2026, the trade balance remained in deficit, albeit narrowing to US$450 million, with exports of US$25.46 billion and imports of US$25.91 billion. Nevertheless, cumulatively, Indonesia’s trade balance for the January–June 2026 period still posted a surplus of US$3.58 billion.
Trade Minister Budi Santoso stated that the monthly deficit was inseparable from the soaring value of oil and gas imports, exacerbated by the surge in global oil prices. He explained that while the volume of both oil and gas and non-oil and gas imports declined, the trade balance tipped into deficit because global crude oil prices rose above US$100 per barrel, compared to a normal price of around US$60–US$65 per barrel. “The reason for the deficit in May is that prices started to rise sharply in March and April. That affected our trade balance in May,” Budi said. He noted that the volume of oil and gas imports in May 2026 was 4.3 million tonnes, down 12.4 per cent from 4.9 million tonnes in April. Non-oil and gas imports also fell from 21.5 million tonnes in April to 18 million tonnes in May, a decline of 15.7 per cent. “In reality, our imports fell in volume terms, but rose in value because oil prices increased,” he added.
The minister underscored that Indonesia’s imports are indeed high, but the type of goods imported must be considered. Indonesia’s import structure is dominated by raw materials and auxiliary materials, which accounted for 71.37 per cent of the total in the first half of 2026. “Raw and auxiliary materials are for production; indeed, many are still imported. Then 19.94 per cent are capital goods such as machinery for production. The remaining 8.69 per cent are consumer goods,” Budi explained. “There are actually not many imports of consumer goods or finished products used directly by consumers. Most imports are raw materials and auxiliary materials.”
Yusuf Rendy Manilet, an economist at the Center of Reform on Economics (CORE) Indonesia, assessed that the trade deficit in June 2026 does not yet reflect a weakening of the external sector. He argued the situation is more accurately viewed as part of a trade structure adjustment process, even though the deficit occurred for two consecutive months. He explained that export performance is still showing a positive trend. The export value in June reached US$25.46 billion, growing 8.84 per cent year-on-year, mainly supported by non-oil and gas exports such as nickel, mineral fuels, and vegetable oils. Conversely, pressure on the trade balance stemmed from a 34.27 per cent surge in imports to US$25.91 billion. The largest increase occurred in oil and gas imports, which jumped more than 100 per cent, pushing the oil and gas sector deficit to US$3.49 billion. The non-oil and gas trade surplus of US$3.04 billion was insufficient to cover this deficit. “On the other hand, the rise in imports also indicates that domestic demand remains quite strong. Most imports consist of raw materials, auxiliary materials, and capital goods used for production and investment. In economic analysis, such imports tend to be productive because they support increased industrial capacity,” Yusuf said.