The better-than-expected exports of Indonesia were particularly attributed to strengthening commodity prices. As a result the trade balance of Indonesia showed a surplus of USD $990 million in December 2016, higher than the USD $830 million (revised) surplus recorded in the preceding month.

However, when we take a look at full-year 2016, then we can see that the nation's export earnings eased compared to 2015. Indonesia shipped USD $144.4 billion worth of goods to its export markets in full-year 2016, down 3.95 percent from shipments in the preceding year. On a positive note, this decline was much softer than the 15.57 percent (y/y) export earnings decline that occurred in full-year 2015.

For its export earnings, Indonesia is highly dependent on the direction commodity prices. When commodity prices peaked in 2011, Indonesia's export earnings reached USD $203.5 billion. However, in line with declining commodity prices, Indonesia's export earnings fell accordingly in the years after 2011. In fact, exports of oil & gas tumbled 30 percent (y/y) in full-year 2016 in terms of value. Over the past two months, however, crude oil has strengthened. The coal price also experienced a marked recovery in the second half of 2016.

Meanwhile, Indonesia's imports in full-year 2016 stood at USD $135.7 billion, down 4.94 percent (y/y) from the nation's import earnings one year earlier. It led to a USD $8.8 billion trade surplus in full-year 2016, improving from Indonesia's USD $7.7 billion trade surplus in the preceding year.

Regarding the forecast for Indonesia's exports in 2017 there should occur an improvement due to the recently unveiled mining rules. Under certain conditions, exports of mineral ore is re-allowed.

Import & Export Indonesia:

2016   Y/Y
(in USD billion)
150.4 144.4 -3.95%
(in USD billion)
142.7 135.7 -4.94%

Source: BPS