JAKARTA (TheInsiderStories) – Good morning! Statistic Indonesia will released the trade data today (02/15). Last month the country’ post trade deficit US$1.1 billion, lower than the previous month which amounted of $2.05 billion. The biggest deficit was still contributed by non-oil and gas sectors.
In 2018, the nation recorded $8.57 billion trade deficit, the worst in more than four decades. Suhariyanto noted, Indonesia’ historical worst trade balance was in 1975 with $391 deficit.
At the meantime, Indonesia and Australia are targeted to sign Comprehensive Economic Partnership Agreement (IA-CEPA) in March, as the previous target in last year delayed. The agreement has been finished in August, but not yet inked. Trade Minister Enggartiasto Lukita said, the agreement signing will be done along with a business forum.
The IA-CEPA agreement postponement was rumored because of Indonesia’ foreign political stance on Jerusalem. Indonesia condemned Australia’ plan to recognize Jerusalem as Israel’ capital city, by moving its Embassy from Tel Aviv to Jerusalem. Though, the embassy location change hasn’t been realized so far.
Furthermore, Moody’s reports that Indonesia’ economic growth will have further slowdown, by increasing below 5 percent in 2019-2020. The condition occurred due to government’ moderate spending and slow pace of infrastructure development.
Even so, Indonesia’s Gross Domestic Product (GDP) is estimated to be stronger than other countries with Baa2 rating. And Indonesia will not be badly hit by global trade slowdown compared to other Asia Pacific countries.
While, United States-China top officials trade talks started yesterday, in Beijing. US Treasury Secretary Steven Mnuchin, who was one of the delegations said, this discussion is something that he had been waiting for.
Besides Mnuchin, US Trade Representative Robert Lighthizer also there for the talks with China’s Vice Prime Minister Liu He and Economic Adviser for President Xi Jinping.These both economic superpowers aim to solve some technical details, including mechanism for executing trade deal.
US President Donald Trump considered to extend the trade truce deal for another 60 days. Previously, the trade truce had been set will ended on March 1. If there is no agreement reached until the deadline, Trump threatened to impose more than double tariffs on Chinese goods imports.
Yesterday, Indonesian financial market was not in a good condition yesterday. Rupiah depreciated by 0.47 percent to 14,090 and hit its worst position this month over the greenback. Meanwhile, the Jakarta Composite Index grew a very little by 0.01 percent to 6,420.01. Foreign investors recorded Rp963.84 billion (US$68.86 million) net sells.
May you have a profitable day!