Top 5 Most Exported Products from Indonesia YTD 2023
November 10, 2023
Economic growth is one of, if not the most important indicators of a nation’s economic development since it directly ties to the nation’s ability to not only fulfill national goals but also increase overall prosperity and people’s welfare. In further developing a nation’s economic growth, various actions and policies are done whether that be domestically or internationally. One of the aspects that correlate directly to national economic development are international trade, specifically how a nation controls and manages their exports and imports.
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As the world becomes more and more interconnected, it is not surprising that all nations including Indonesia have pushed on the significance of international trade for economic development. This is due to exports and imports being able to provide benefits such as increase in a nation’s production, help with a nation’s economic stability and growth. Although, it is noted that balance between imports and exports is important to decrease or prevent significant dependencies which may lead to economic decline. This article specifically will discuss exports in its definitions, general pros and cons, and also the top 5 most exported products to give a better understanding on export conditions in Indonesia.
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Export as explained before, is the base activity in international trade along with imports which can be understood as an activity of selling domestically produced goods and services towards international buyers or other nations. This is in order to not confine a nation’s production and economic growth from their geographical border and instead also seek a wider market with potential to create greater revenue, more opportunities and demands for businesses, while also creating relations with others.
In general, exports create many benefits like how it can expand market demands which create job opportunities, increase opportunities for sales and national profit, open up relationships through trade agreements, and may allow discoveries of new technologies, marketing practices and insights from other nations. On one hand of the spectrum however, exports can also create many risks for the exporting country such as high transportation costs, risks regarding devaluing currencies, and can increase operational risk in some areas due to unknown political or geographical risks.
According to data from the Central Bureau of Statistics (BPS), Indonesia’s export value with the latest date of October 2023 has reached $22,15 billion USD (increased by 6,76 %) since September 2023 with overall value this year reaching $214,41 billion USD. Although it is noted that Indonesia’s trade activity has experienced a significant decline from last year with an overall decrease by 12,15 % in the same period. This is said to be caused by the dwindling of global commodity prices, reduced prices of several crucial Indonesian commodities on the international market and the economic slowdown in a number of major trading partner countries. This in turn not only affects national export profit but also creates changes on the value of the previous export products in the international market. With that in mind, these top exported products in 2023, include:
Mineral Fuel with a total value of $2,735.5 million USD became one of the most exported products in Indonesia despite the decline followed by Animal/Vegetable Fats and Oils and also Iron and Steel exports. For Mineral Fuels, it is said that its exports still experienced an increased MoM basis although a decline from last year. This may be caused by the voluntary cut of crude oil, international demand, China’s economic condition, and also global stock of mineral fuels.
Despite the export slowdown experienced by Indonesia, there are some products that still managed to experience an increase on MoM basis with one of them being Animal/Vegetable Fats and oils which went up by 43.68%.
Iron and Steel is also one of the products that experienced an increased MoM with an increase up by 7.36%. This may be due to a surplus in production and increased demands for Iron and Steel products in the international market.
The presence of Electrical Machinery and Equipment from Indonesia have always contributed significantly in the nation’s international trade. This can be seen in the previous year where it amounted to 4.98% of total exports. Recent government attention has also increased for the automotive industry which may also contribute to Electrical Machinery and Equipment still being one of the most exported products from Indonesia.
With the automotive industry receiving significant attention by the government, it is not surprising that exports regarding vehicles and its additional parts are pushed forward. The expansion specifically for automotive exports is one of the government’s efforts to increase production overall with the goal that this year it can reach 500 thousand exported vehicles and its parts.
Overall, one of Indonesia’s export pioneer is in its mineral fuel resources, essentially because Indonesia has abundant natural resources.
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