Indonesia’s trade performance remains resilient amid global uncertainties, recording another surplus in June driven by moderate export growth, primarily buoyed by crude palm oil (CPO). According to Statistics Indonesia (BPS) Deputy Pudji Ismartini, the country posted a US$4.1 billion surplus for June—the 62nd consecutive month of trade surplus since May 2020—reflecting sustained export strength despite weakness in the manufacturing sector. For the first half of 2025, the cumulative surplus stood at $19.5 billion, underscoring Indonesia’s continued trade resilience.
The United States emerged as Indonesia’s largest bilateral surplus partner, contributing over $8.57 billion, followed by India at $6.6 billion and the Philippines at $4.4 billion. Key export commodities driving the surplus included electrical machinery, clothing, and footwear, with notable growth in export value. In particular, CPO exports surged to $11.4 billion in the first half, up 24.8% from the previous year, driven mainly by a 22.2% increase in prices despite volume growth of just 280,000 tonnes. Conversely, coal exports declined by 21%, reflecting ongoing commodity market fluctuations.
On the import side, June figures increased 4.28% year-on-year (YoY) to $19.3 billion. While exports of raw materials and intermediate goods contracted slightly by 2.74%, imports of capital goods soared 38%, signaling strong investment activity. This uptick in capital goods imports is often viewed as an indicator of business confidence and future growth. Despite this, Indonesia’s manufacturing PMI remains in contraction territory, with S&P Global reporting a July PMI of 49.2—improving from 46.9 in June but still below the threshold of 50 that signals expansion.
Josua Pardede, chief economist at Permata Bank, interprets the rising capital goods imports as a proactive measure by firms preparing for increased production and demand in the coming months. He suggests that these investments typically result in higher output within a three-to-six-month window. Looking ahead, Pardede projects Indonesia’s current account deficit may widen but remain manageable, likely below 1% of GDP. External factors, notably the ongoing global trade tensions, could further influence the balance of payments, potentially increasing the deficit by 0.3 to 0.6 percentage points, with a full-year estimate of 0.87% of GDP.
Investment and Downstream Minister Rosan Roeslani views the increase in capital goods imports as a positive indicator of improving foreign direct investment (FDI) inflows in the latter half of 2025. While FDI accounts for over half of total investment, recent quarterly data shows a 6.95% YoY decline in FDI, which represented roughly 42.3% of total investment in Q2. Commentary from Economist Intelligence Unit (EIU) researcher Wen Chong Cheah underscores the nuance in interpreting capital goods data—they can signal expansion plans, yet are also influenced by delayed investments, government infrastructure projects, or imports driven by public procurement rather than private sector sentiment.
Overall, Indonesia’s trade landscape indicates resilience amid challenging global conditions, with robust exports, increasing investment intent, and a cautious outlook on the current account, positioning the country to navigate the evolving macroeconomic environment with a degree of agility.
July 31, 2025, The Jakarta Post(https://www.thejakartapost.com/business/2025/08/01/ri-maintains-trade-surplus-despite-spiking-capital-goods-imports.html)