RI suffers trade deficit
JAKARTA (JP): Indonesia's trade in June ran a deficit for the first time in several years due to increasing imports of machinery and auxiliary materials for industrial production, Minister of Information Harmoko announced yesterday.
"Our exports reached US$3.76 billion in June, while imports were recorded at $3.97 billion, so we had a deficit of US$204.9 million that month," he told reporters after a monthly cabinet meeting at the Bina Graha presidential office.
"President Soeharto ordered all related parties to help boost exports and reduce imports to get a surplus again and strengthen our foreign exchange reserves," the minister said.
Indonesia's foreign exchange reserves are currently estimated at about $13 billion.
Harmoko explained that Soeharto, who presided over yesterday's meeting, wanted all related parties to take part in expediting exports.
"The President also wants all related institutions to facilitate imports of capital goods and auxiliary materials for industrial production," he said. "However, we should not import materials which have been produced domestically."
Harmoko said that non-oil products contributed $2.91 billion to June's export revenues, while oil and gas exports accounted for $858.3 million.
He said the June exports brought Indonesia's total exports during the first six months of this year to $21.18 billion, consisting of $15.91 billion of non-oil exports and $5.26 billion of oil and gas exports.
"The January to June exports indicated a 15.05 percent increase over the same period of last year," he said.
Harmoko said the country's imports during the first six months of this year rose 30.7 percent to $19.28 billion over the corresponding period last year. "Indonesia, therefore, gained a trade surplus of $1.89 billion in the January to June period," he explained.
According to the Central Bureau of Statistics, the trade surplus of $1.89 billion in the January to June period was far lower than the trade surplus of $3.65 billion in the first half of 1994 and $4.59 billion in the first half of 1993.
Inflation
Harmoko said the cabinet meeting, which was attended by Vice President Try Sutrisno, also reported a 0.32 percent increase in the country's inflation rate in August.
The increase in the August inflation rate was caused by a rise in food prices by an average of 0.07 percent, housing costs by 0.17 percent, clothing prices by 0.18 percent and the price of miscellaneous goods and services by 0.8 percent
Inflation in August brought the country's cumulative inflation rate to 6.41 percent during the first eight months of this year.
"We hope we can maintain the slow growth of prices in the coming four months so we can keep the inflation rate below 10 percent this year," Harmoko said.
He said the money supply reached Rp 47.7 trillion ($21.04 billion) as of the end of July.
The money supply was recorded at Rp 47.33 trillion as of the end of June and Rp 45.22 trillion as of the end of May.
The minister said the cabinet session also discussed extending collateral-free loans of up to Rp 50 million for small businesses.
"The state-owned Bank Rakyat Indonesia and Bank Negara Indonesia will start providing the collateral-free loans this month," he said. "Other banks will follow suit next month."
He said about 19 million small businesses will be eligible for the loans.
Borrowers are not required to have collateral but must prove that their business has good prospects, he said.
Minister of Finance Mar'ie Muhammad said last month that to be eligible for the collateral-free loans small businesses must open savings accounts at the creditor banks.
Harmoko said that the 4.6 percent increase in the number of tourist arrivals in Indonesia was also discussed. Arrivals reached 1.96 million during the first seven months of this year, bringing in revenues of $2.34 billion. (riz)