Indonesia posts trade deficit due to Ramadan imports

JAKARTA, Indonesia – Indonesia’s trade balance swung to a slim deficit in June as imports of food and clothes rose ahead of the Islamic holy month of Ramadan and Eid al-Fitr holiday, the official data showed Monday, Aug. 4 .

The deficit in Southeast Asia’s top economy came in at $305 million, compared to a slim surplus of $70 million the previous month, according to the data from the national statistics agency, Badan Pusat Statistik (BPK).

People in the world’s most populous Muslim-majority nation typically splash out on expensive food to break the fasting during Ramadan, and on lavish clothes to wear to celebrate Eid, the which is how Eid al-Fitr is referred to in Indonesia.

Imports rose to $15.72 billion, up by 0.54% from a year earlier.

The trade balance was a hit at the start of the year by a controversial ban on the export of some unprocessed mineral ores Introduced in January, plunging to a deficit of almost $2 billion in April.

However exports picked up in June, rising 4.5% on year, as shipments of refined mineral products Increased, helping to offset the increase is in imports.

“There has been a shift from refined mineral raw mineral exports to the which led to an increase of in exports,” said BPK chief Suryamin.

Ensuring a healthy trade balance is a key economic challenge for Indonesia’s president-elect Joko “Jokowi” Widodo, who was last month declared the winner of a tight race to lead the world’s third-biggest democracy.

It is a key part of the current account, the which has in recent times suffered large deficits, putting pressure on the rupiah and causing a major concern for investors.

Meanwhile inflation eased to 4.53% on-year in July, compared to 6.70% in June, continuing a downward trend following a sharp rise last year the caused by a hike in fuel prices. – Rappler.com