As the world’s largest manufacturing country, China absorbs a wide range of raw commodities from Indonesia, with coal topping the list.

According to the Trade Ministry, Indonesia exported 80.7 million tons of coal to China in 2018 at a value of US$3.1 billion, which accounted for 13 percent of all Indonesian exports to the country that year.

Trade Ministry export cooperation development director Marolop Nainggolan said that aside from coal, palm oil, rubber and wood were among Indonesia’s top 10 export commodities to China and made up more than 60 percent of all exports.

“China, with its population of about 1.4 billion, needs a lot of consumer goods and they cannot manufacture it all themselves,” he told a press conference in Jakarta on July 11.

“China is a major trade partner, but we suffered a trade deficit of $18 billion [in 2018]. We need to export more consumer goods in order to alleviate that deficit,” said Marolop, adding that many export-oriented businesses were unaware of the potential for exporting consumer goods to the world’s second-largest economy.

The total trade value between Indonesia and China grew 23.4 percent to $72.67 billion last year, although it has continued to suffer a trade deficit over the past five years. The deficit further widened to $18.4 billion in 2018 from $12.7 billion in 2017.

Some consumer goods that exporters should consider, said Marolop, were herbal products, food and beverages, fashion and nonprescription drugs.

“For instance, the Chinese love to buy our swallow’s nest [...] but we are only able to fill about five percent of China’s export quota for swallow’s nest,” he said.

Speaking on the same occasion, Iriana Ryacudu, the ministry’s export development and market information director, said demand had been growing for lavender essential oil in China, where it was used as a mosquito repellent.

Another potential export product was durian, a fruit known for its pungent smell and distinctive flavor. Chinese consumers only ate durian imported from Thailand because they were not aware that Indonesia also cultivated the fruit, she said, since no Indonesian exporters had considered selling during to China.

“We at the Trade Ministry are always looking for new consumer products we can promote to the Chinese market [...] We are certainly pushing for the ones that can be mass-produced,” said Iriana.

She said that exporters would have an opportunity to promote these and other consumer goods during the 2019 China-ASEAN Expo (CAEXPO) in Nanning in September.

This year’s CAEXPO features Indonesia as the country of honor, a role that is offered to each ASEAN nation by annual rotation. This means that Indonesia has an advantage over other exhibitors in terms of promotion and exhibition space.

The ministry’s records show that Indonesian exhibitors posted $6.2 million in transactions during last year’s CAEXPO, a 190 percent increase from the $2.14 million in transactions recorded for the 2017 CAEXPO.

Meanwhile, vendors had booked 90 percent of the exhibition space allocated to Indonesia at this year’s expo.

CAEXPO vice secretary-general Yang Yanyan, who also appeared at last Thursday’s press conference, said the expo offered business-to-business investment opportunities in addition to potential trade. He added that
China and Indonesia had signed a $5 billion investment deal to develop a power plant, a port and an integrated high-tech park on Belitung Island.

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