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View all search resultsGovt seeks better balance for export destinations
The government is seeking to cut the disparities between non-oil and gas export volumes to the five biggest export destinations in a bid to mitigate risks due to global economic uncertainties, by spreading risks better across trade portfolios
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T
he government is seeking to cut the disparities between non-oil and gas export volumes to the five biggest export destinations in a bid to mitigate risks due to global economic uncertainties, by spreading risks better across trade portfolios.
The head of the research and development department in the Trade Ministry, Muchtar, said a more even export volume to the five destinations would strengthen Indonesia's capacity to weather possible shocks from any further decline of demand such as happened last year.
Indonesia's biggest export markets for non-oil and gas products are the ASEAN countries, Japan, the EU, China, and the US. "In future, exports to the five biggest export destinations must not exceed a certain level," Muchtar said.
Reducing the disparities in these exports volumes, Muchtar said, does not mean that the values of portfolios must decrease.
"Our strategy would be to reduce the volume of the main commodities and spread them more evenly to other export destinations while increasing the volume of other types of goods," he said.
According to the Indonesian central statistics agency (BPS) latest data, the country's non-oil and gas exports until the end of January reached US$1.96 billion to ASEAN, $1.29 billion to Japan, $1.17 billion to the EU, $1.01 billion to China, and $991.09 million to the US.
The government's move to diversify the country's exports in terms of destinations and types of products has been intensifying since the beginning of 2008 when the trade ministry forecast the need to balance the country's export structure.
The diversification program, Muchtar said, paid of in 2009 when Indonesia weathered the slump in demand from the US, reducing its dependency on that market.
"We shouldn't depend too much on any one country. We have to diversify our export market shares."
"The diversification policy was one of the things that made us successful in maintaining positive economic growth while many economies contracted," he said.
Trade Minister Mari Elka Pangestu previously said the government was setting a target that non-oil and gas export growth would reach between 7 and 8.5 percent in 2010 before further increasing to between 14.5 and 15.5 percent in 2014.
"If the non-oil and gas exports grow to around $9 billion in every month, so the minimal target for exports in 2010 would be the same as for 2008," Mari said in a hearing with the commission VI of the House of Representatives on Monday.
