03/12/2011 (Jakarta Post) - Indonesia recorded a trade surplus with China for the first time since the implementation of a free trade agreement (FTA) despite signs of slowing export growth to the country’s major buyers, the Central Statistics Agency (BPS) says.

BPS deputy chairman for distribution and services statistics Djamal said on Thursday that overall monthly exports further slid 4.2 percent to US$16.8 billion after a 4.5 percent decline to $17.8 billion in September

Scaling the heights: A worker watches his colleague leap from one container to another at the Tanjung Priok Harbor in North Jakarta. The Central Statistics Agency recorded in October that Indonesia had for the first time achieved trade surplus with China. JP/Ricky Yudhistira

Total exports during the first 10 months of this year, however, continued to show a positive trend. From January to October this year, exports soared 30.36 percent from a year earlier to $169.03 billion, slowing from January to September’s 37.5 percent annual growth.

The government has targeted $200 billion in exports by the year’s end, as Indonesia enjoys a surge in commodity prices. Indonesia is the world’s largest exporter for coal and crude palm oil (CPO) and one of major suppliers of other commodities such as rubber.

Bank Central Asia (BCA) economist David Sumual said these readings “have begun to show declining overall demand, though not significantly”. Trade surplus also fell to $1.15 billion in October from $2.72 billion in September.

“Our major trading partners — China, India and other Asian countries — will not allow drastic slowdowns of economic growth, so demands for our export products would not be drastically affected,” he said.

Southeast Asian countries account for over 20 percent of Indonesia’s non-oil and gas exports so far this year — China for 13 percent and Japan for 12 percent — while debt-stricken EU nations accounted for 13 percent and the troubled United States for 10 percent.

Despite lowering the trade surplus and slowing export growth in October, Indonesia’s trade balance booked the first surplus of $106.9 million with China, as non-oil and gas exports to the world’s second-largest economy jumped while imports declined, said BPS director for distribution statistics Satwiko Darmesto.

China’s demand for Indonesian products increased 8.21 percent to $2.24 billion in October from September, while imports from China dropped 3.18 percent to $2.13 billion.

“Imports from China slipped, mainly for products of iron and steel, chemical and petrochemical, while our exports increased as usual,” Satwiko said.

Indonesia suffered a trade deficit with China since the implementation in early January of the free trade agreement between China and the Association of Southeast Asian Nations (ASEAN), of which Indonesia is a member.

Danareksa Research Institute head of research Purbaya Yudhi Sadewa said Indonesia’s exports to China were mostly for products that were resilient to crisis, and therefore the Chinese would need the products even in times of economic slowdown.

“China’s demand for our products remains strong despite a slowdown in its economic growth to 9.1 percent in the third quarter,” he said.

Indonesia’s overall imports accelerated 33.03 percent in January to October this year from the same period last year on the back of strong growth in raw material imports.