About Export and Import in Indonesia
Export is the activity of sending goods out of the customs area and usually happens when domestic demand is met, allowing surplus goods to be sold abroad.
Exports are divided into two types:
-
Oil and Gas (O&G) exports
-
Non-Oil and Gas exports (e.g., agricultural, plantation, forestry, livestock, crafts, industrial goods, mining minerals)
Factors that influence export:
-
Foreign market conditions
-
Government business climate
-
Exporters’ ability to compete globally
-
International trade agreements
Import, based on Government Regulation No. 10 of 2021, is the activity of bringing goods into the customs territory—typically to procure items that are not domestically available.
Types of imported goods:
-
Consumer goods
-
Capital goods
-
Raw materials
-
Supporting materials
Factors influencing imports:
-
The importing country lacks raw materials or technical expertise
-
It’s more cost-effective to import than to produce locally
-
Domestic production is insufficient to meet demand
Benefits of Export and Import for Indonesia
There are 4 key benefits:
-
Promoting Local Products
Exporting helps introduce Indonesia’s unique products to the global market. -
Increasing Foreign Exchange Reserves
More exports mean more foreign exchange, contributing to economic stability. -
Access to Goods/Services Not Available Locally
Different countries have different natural resources. -
Fostering International Cooperation
Cross-border trade strengthens diplomatic and economic relationships.
Challenges in Indonesia’s Export-Import Activities
International trade isn’t always smooth—several challenges include:
-
Economic and political policies
Protectionist import restrictions are common to shield domestic industries. -
Currency exchange differences
Exporting countries may demand payments in their own currencies, though USD or EUR are most common. -
Domestic conflicts or instability
Political unrest increases transaction risks. -
Complicated bureaucracy
Lengthy procedures delay export-import processes. -
Low-quality human resources
Natural resource-rich countries may struggle without skilled labor. -
Regional trade organizations
Some trade blocs limit access to member countries only. -
Logistical issues
Problems in inventory, distribution, and warehousing can disrupt supply chains.
Solutions to Indonesia’s Export-Import Challenges
From a logistics perspective, there are 3 key solutions:
1. Bonded Logistics Center (PLB)
A multifunctional warehouse that offers import duty and tax deferrals and allows raw material storage for up to 3 years.
PLBs also have Quality Control—enabling SMEs and small industries to participate competitively in exports/imports.
Learn more about PLB [click here].
2. TCI Plug and Play
A digital warehouse and inventory management system designed for distributors and manufacturers.
It provides accurate, transparent inventory data and optimizes warehouse operations.
Learn more about TCI Plug and Play [click here].
3. Warehousing Solutions
Warehouses function as distribution hubs from suppliers to end users.
TCI offers customized warehouse services and strategic locations to streamline operations and reduce delivery time.
Learn more about TCI Warehousing Services click here.