Indonesian workers unload barrels containing crude palm oil at
a port in Jakarta. Indonesian exports surged 29 percent last year.
(EPA Photo)

02/02/2012 (Jakarta Globe) - Indonesia’s exports rose to a record $204 billion last year, beating the government’s forecast and setting the record for a Southeast Asian nation, but many are warning that the stellar performance may not continue this year.

“Indonesia managed to double exports within five years. It is quite remarkable considering a lot of countries take [a lot longer] than five years to achieve that,” Trade Minister Gita Wirjawan said on Wednesday.

Gita said Saudi Arabia took 26 years to double the value of its exports, Singapore took 10 years, South Korea nine years, while Malaysia and China took seven and six years, respectively.

Countries that managed to double exports within five years include Belgium, Russia, Switzerland, the United States and Brazil, he said.

The 2011 export total represented a 29 percent increase from 2010’s $158 billion, the Central Statistics Agency (BPS) said. The government originally forecast total exports to reach $200 billion last year.

Still, businesspeople, economists and government officials warned that the euro zone debt crisis, coupled with a global economic slowdown, may crimp demand for commodities and push exports down this year.

“Some people have said Indonesia does not need a strong Europe because Indonesia relies less on Europe than on other parts of the world. That’s not true,” Gita said.

The minister added that commodities exported from Indonesia to other parts of Asia would, in turn, be sold to Europe and the United States. “The products will eventually go to the ultimate destination, Western Europe and the United States,” he said.

The slowdown was reflected in the country’s rubber exports, which last year accounted for just 9 percent of total exports.

“Because of the debt crisis in Europe and the United States, demand from China and India and emerging markets was down as well,” said Asril Sutan Amir, chairman of Indonesian Rubber Association (Gapkindo).

Signs of slowing overall exports have been felt since December. Exports slowed that month 2.2 percent from a year earlier after gaining 10.2 percent in November, BPS data showed. It was the slowest pace since September 2009, when exports contracted 19 percent.

The International Monetary Fund has predicted that Europe will fall into a mild recession as its debt-ridden governments do not have enough fiscal or monetary capacity to boost the continent’s foundering economy.

Gundy Cahyadi, an economist at OCBC Bank in Singapore, said the latest export figure “doesn’t bode well for growth prospects going forward.”

He added that economic growth in the fourth quarter last year may have been at 6.3 to 6.4 percent, slower than the 6.5 percent economic expansion in the third quarter of 2011.

Indonesia’s exports account for about 27 percent of the country’s economy while investments make up 32 percent, based on the value of the country’s economy as of the third quarter last year, the latest period for which figures are available.

Private consumption accounts for 56 percent of the economy, which at $706 billion is the largest in Southeast Asia.

Gita said export growth was expected to slow this year to $205 billion.

“If we can keep exports the same as last year, it would be good enough,” he said.