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Jakarta Post

‘A shock like no other’: Commodity slide to pressure Indonesia

  • Norman Harsono

    The Jakarta Post

Jakarta   /   Mon, April 27, 2020   /  11:05 am
The Jakarta Post Image
A worker monitors the mineral flotation process to produce copper, gold and silver concentrates at a Freeport Indonesia facility in Mimika, Papua.(Kompas/B. Josie Susilo Hardianto)

Global commodity prices are expected to tumble this year in a way unseen since the 1900s. This is bad news for major commodity exporting countries like Indonesia. The World Bank’s 2020 commodity outlook report projects a 40.3 percent decline in energy commodity prices from last year’s average. This is accompanied by drops in industrial metal prices (13.2 percent) and agricultural prices (1.1 percent). Such observations are not new but the report, released on April 23, provides a quantitative measure of COVID-19’s impact on commodity markets. The World Bank describes the impact as “a shock like no other” since the 1900s, including the 1980 global recession, the Sept. 11 terrorist attacks and the 2014 Ebola outbreak in Africa. “This will add pressure for Indonesia,” economist Piter Abdullah of the Perbanas Institute told The Jakarta Post o...