Indonesia's trade balance in July 2024 is expected to maintain a surplus, with projections suggesting an increase to USD 2.67 billion, up from USD 2.39 billion in the previous month. This growth is driven by an increase in exports, which outpaced the rise in imports. According to Josua Pardede, Chief Economist at Bank Permata, exports in July 2024 are estimated to have grown by 6.29% month-on-month (mtm) or 6.2% year-on-year (yoy), supported by higher prices for key commodities like crude palm oil (CPO), which rose by 2.6% mtm, and coal, which grew by 1.8% mtm. However, the volume of exports may have slowed, reflecting a decline in the manufacturing Purchasing Managers' Index (PMI) from major trading partners such as China, the United States, India, and South Korea.
On the import side, growth is expected at 5.62% mtm, though it is projected to decrease by 0.42% yoy. The rise in Brent crude oil prices by 3.3% mtm is likely to boost oil and gas imports, even as Indonesia's manufacturing activity declines. In contrast, Hosianna Evalia Situmorang, an economist at Bank Danamon, predicts a lower trade surplus of USD 1.3 billion for July 2024, citing a slowdown in both exports and imports. Indonesia's manufacturing PMI fell to 49.3 in July, indicating a contraction in the sector, the first since August 2021. Despite these challenges, the overall trade balance is expected to remain in surplus for the month.
