Ending the year with optimism
In his speech during the Annual Bankers' Dinner recently hosted by Bank Indonesia, President Jokowi appeared confident that the Indonesian economy will remain resilient in the face of the slowdown of the global economy. At the same time, he emphasized the need to look for new resources to keep the economy alive and to remain optimistic in order to face global economic pressures, a message he took from the movie "Castaway".
The broad statement by the President was in line with my own observations about companies gathered on many occasions throughout the country. Apparently, the majority of those companies performed well in 2019 and in fact remained optimistic going into 2020, facts corroborated by the data of banks that showed good performance of the companies in their loan books, leaving non-performing loans manageable.
In the midst of this situation, the Indonesian balance of trade for the month of November 2019 registered a large deficit. Exports in November 2019 reached $14,010.3 million, down by 6.17% from the previous month, and down by 5.67% year over year. Meanwhile, imports reached $15,340.2 million, up by 3.94% from the previous month but down by 9.24% year over year. Thus, the trade balance for the month of November was in deficit of $1,329.9 million, a significant reversal from the previous month, which reported a surplus of $172.5 million. With the deficit in November, the total trade balance for the first eleven months of 2019 was in deficit of $3,105.7 million.
The Central Board of Statistics also released the inflation report, which showed inflation of 0.14% for the month of November. With that performance, year-on-year inflation stood at 3.00%, a level at the lower part of the target corridor of the Central Bank. With inflation largely under control while the real economy was slowing down, the Central Bank decided to keep the bench mark interest rate at 5.00% at its Monetary Policy Meeting in December 2019.
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