As per the current scenario, global economic

conditions appear to be improving as

compared to 2012, but at a slow and uneven

pace.

Like other commodity exporters, Indonesia

has clearly felt the effects of the weaker

global economy in 2012 through the trade

channel.

 The economic development of Indonesia in the past half a century has waxed and waned. From near economic ruin and hyperinflation in the 1960s, to the oil boom of the 70s, to the economic crash of the late nineties and finally to the relative smooth sailing of the present global financial crisis.

The current trade agenda pillar of the broader strategy is predicated on three medium term trade policy objectives: 1. To increase the export of non-oil products 2. To strengthen the domestic market and manage the availability of basic products 3. To strengthen national distribution channels

 Trade deficit of 846.60 USD Million in June of 2013 Balance of Trade averaged 788.24 USD Million from 1960 until 2013 All time high of 4641.92 USD Million in December of 2006 Record low of -1700 USD Million in April of 2013.

 Since the 1970s Indonesia has been recording trade surpluses due to exports growth. However, in 2012, the country posted trade deficit, as exports fell due to a slowdown in the global economy and surge in imports. Much of the decline in exports can be attributed to weaker commodity prices, many of which remain under pressure.

 Imports decreased to 15587.30 USD Million in June of 2013 from 16660.50 USD Million in May of 2013. Indonesia Imports averaged 2598.62 USD Million from 1959 until 2013, reaching an all time high of 17207.93 USD Million in October of 2012 and a record low of 21 USD Million in September of 1959.

 Oil and gas (around 22 percent of total imports) Machinery (15 percent) Electrical equipment (10 percent) Iron and steel (5 percent) Vehicles (5 percent)

 China (19 percent)

Japan (15 percent)

The United States (7.5 percent) Singapore (7 percent) Thailand South Korea Malaysia

 Exports decreased to 14740.70 USD Million in June of 2013 from 16133.40 USD Million in May of 2013. Exports averaged 3434.26 USD Million from 1960 until 2013, reaching an all time high of 18647.83 USD Million in August of 2011 and a record low of 30 USD Million in January of 1961. Exports have been an engine of growth in recent years

 China (14 percent)

Japan (12 percent)

The United States (9.5 percent)

India (8 percent)
Singapore

Malaysia
South Korea

 Indonesia has become a darling of some international companies and investors in recent years as its strong economic expansion and relative political stability have given more people confidence in the market Foreign direct investment in Indonesia grew 20% last year to 175 trillion rupiah ($19.3 billion) At that rate, Indonesia now appears to be significantly outpacing many other Asian countries that used to easily surpass it in drawing foreign money

 Top foreign investors in Indonesia are

Singapore Japan The United States The Netherlands

South Korea

The industries that attract the most

international investment are transportation,

mining and utilities.

 Posco plans to spend up to $3 billion on a steel-making project in Indonesia by the end of 2013. Suzuki Motor Corp. will spend $779 million to build an engine plant and increase output in Indonesia.

 Toyota Motor Corp. has committed $337 million to expand production capacity. Caterpillar Inc. will invest $150 million to build a new factory to produce mining trucks for customers in Indonesia and elsewhere in Asia.

 Complexity, lack of transparency and trade-impairing effects of import licensing requirements Export restrictions and taxes on raw resources Ownership limitations on banks

 Enactment of important laws and reform measures to investments, export financing, customs procedures, as well as in sectors such as agriculture, fisheries, shipping, mining and tourism. Systemic efforts to reduce constraints on trade, investment and production and to streamline procedures at the border.