As an open economy, Indonesia will also be affected.
he United States and China are two of the world’s most powerful economies. The dynamics in the two countries’ relations can significantly affect the global economy.
As an open economy, Indonesia will also be affected. To ensure that our economy keeps growing amid the growing external pressures, the potential risks should be calculated and anticipated through appropriate policy actions.
Some aspects make it necessary for the government to calculate the risks of the escalation in US-China trade tensions.
First is the current condition of our trade balance. As we know, the trade balance indicates whether a country is a net exporter or importer of goods. Indonesia’s trade balance recorded a US$2.83 billion deficit in January to May. This deficit was the cumulative result of four monthly deficits during that period, meaning that 2018 has by far had the highest number of monthly deficits in the last few years.
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