What is a Trade Balance?
In economics, the trade balance refers to the difference in value between a country’s exports and imports over a certain period.
It is usually measured annually and expressed in a mutually agreed currency depending on the economic union.
Types of Trade Balances
Trade Deficit
A trade deficit occurs when the value of a country’s imports exceeds its exports. This is generally considered unfavorable for developing countries due to higher spending on imports than earnings from exports.
Balanced Trade
A balanced trade occurs when export and import values are equal. In such cases, the government does not suffer losses from international trade.
Trade Surplus
A trade surplus happens when a country’s export value is significantly higher than its import value. This condition is favorable as it leads to higher national income.
What is a Surplus?
In accounting, a surplus refers to a condition where income exceeds expenditures. Governments often use this term to describe the state of the national economy.
One common cause of a surplus is when monthly export values surpass import values, as was the case in June 2021.
June 2021 Trade Surplus
According to BPS, Indonesia recorded higher exports than imports in June 2021, resulting in a surplus during the month commemorating Pancasila’s birth.
The BPS noted that Indonesia’s exports in June reached USD 18.55 billion, while imports stood at USD 17.23 billion.
The higher export figure compared to imports created a surplus, indicating signs of economic revival.
Although the surplus in June 2021 was lower than May’s surplus of USD 2.7 billion, it still showed growth compared to June 2020’s surplus of only USD 1.2 billion.
Cumulative data shows that imports totaled USD 11.86 billion, contributing to overall trade balance improvement.
Sustained Surplus Across Sectors
The trade surplus in June 2021 stemmed from increased activity in both export and import sectors. This growth was consistent month-on-month and year-on-year.
Despite the ongoing COVID-19 pandemic, Indonesia’s trade surplus performance has been impressive—recording 14 consecutive months of surplus since May 2020.
In fact, the 2020 surplus reached USD 21.62 billion—the highest in the past decade.
This surplus was driven by successful expansion of Indonesia’s top commodities in foreign markets.
Maintaining a trade surplus requires monitoring key factors such as:
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Growth in global demand, particularly from stable major markets
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The role of trade representatives (Perwadag) in boosting exports
A balance between these elements and smart import control strategies will ensure trade surplus continues.
Non-Oil and Gas Sector Contributions
Indonesia’s surplus largely came from non-oil and gas commodities such as:
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Mineral fuels
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Iron and steel
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Animal fats and oils
Higher demand for these products significantly boosted exports.
Additionally, the rise in global commodity prices (e.g., coal from Australia) contributed to stronger export performance.
June 2021’s imports totaled USD 17.23 billion—comprising USD 2.3 billion in oil & gas imports and USD 14.94 billion in non-oil imports.
Overall trade activities in June 2021 showed growth in demand across all sectors.
Manufacturing activity in major trading partners like the United States and China also played a role. High global market demand further fueled Indonesia’s export volumes.
Signs of Economic Recovery
Though COVID-19 has severely affected the economy, several signs show recovery is underway—such as the June 2021 trade surplus.
This indicates that the economy is gradually bouncing back, supported by resilience and optimism.
Other signs of ongoing recovery include:
1. Health Protocols and Vaccination Campaigns
Continued adherence to health protocols and the ongoing vaccination rollout have built public confidence and reduced COVID-19 transmission, allowing the economy to reopen.
2. Strengthening of the Stock Market and Rupiah
The Jakarta Composite Index (IHSG) has seen gains in recent months, indicating investor confidence.
Likewise, the strengthening of the Rupiah is a positive economic indicator.
3. Rising Commodity Prices
Global commodity prices have increased, reflecting signs of worldwide economic recovery.
4. Growth in Micro Business Loans (KUR)
The increase in small business loans under the People’s Business Credit (KUR) scheme shows growing public trust and willingness to invest in entrepreneurship.
With this overview of Indonesia’s June trade surplus, including key concepts and contributing sectors, you’re now better equipped to monitor Indonesia’s evolving economy and ongoing recovery.