Indonesian trade and industry data 2018-2023 from SEKI Bank Indonesia

The recent Indonesia’s 200% tariff aimed at Chinese products proposed by the Indonesian Minister of Trade, Zulkifli Hasan (Zulhas), startled businesses. Some love it, some others despise it. One thing for sure though, it created (still is, matter of fact) another confusion after series of blunder by the Ministry of Trade. This 200% tariff is no different, where Luhut just toned down the 200% tariff hype. We also have no idea in what form this tariff will be (MFN? Anti dumping? Safeguard? or even some form of NTM?) What exactly the government want? No idea.

The main reason of such tariff is the recent mass layoff in the textile industry, and also ceramic tile. Zulhas mentioned 7 products that will be covered by his new tariff, textile and ceramic stuff included. That’s why me and Deasy Pane, my long time colleague, has a check and wrote for East Asia Forum about this. We host several data we use for the piece in this blog.

Various data in this post is taken from SEKI Bank Indonesia, with the exception being table 1 where we took them numbers from WITS.

We think this tariff is not only too sudden, too big, but also potentially misses Indonesia’s actual problem. First is the fact that Indonesia’s import from China is dominated by intermediate inputs and capital goods. Table 1 shows Indonesia’s import from China by BEC taken from WITS, while table 2 shows this in general (import from all countries), sourced from SEKI. Indonesia’s consumer products from China is actually dropping in share. In fact, Zulhas' proposed tariff will cover important textile inputs like fabrics, threads, and cloth, which are needed to make shirts and pants and other wearing apparels. Tariff will hurt downstream producers, on top of the weak rupiah they have at the moment.

In fact, we argue it can possible harm Indonesia now that the US-China trade war hinders global value chain, where Chinese firms try to avoid US tariff by moving parts of their production chain to ASEAN. Vietnam and Bangladesh are actually benefited from this diversion BECAUSE they can import chinese stuff.

Table 1. Indonesian imports from China by broad economic category

Goods category	2018	2019	2020	2021	2022
Capital value	11,487,301.6	12,321,681.1	10,828,207.3	14,880,690.1	20,127,730.3
Consumer value	5,761,119.1	6,023,792.5	5,468,645.2	6,515,606.2	7,113,856.5
Intermediate value	28,039,338.4	26,302,772.6	23,054,342.8	34,354,081.1	39,842,624.6
Capital share	25.2	27.4	27.3	26.5	29.7
Consumer share	12.7	13.4	13.8	11.6	10.5
Intermediate share	61.6	58.5	58.2	61.1	58.8

Table 2. Indonesian imports by broad economic category

year	18	19	20	21	22	23
Share of consumption goods	14.37%	14.29%	13.31%	14.18%	14.19%	14.84%
Share of material goods	72.24%	71.79%	72.44%	74.01%	72.85%	70.11%
Share of capital goods	16.98%	17.61%	17.76%	15.25%	16.25%	18.63%
Growth of consumption goods	-	-8.75%	-18.35%	39.88%	21.46%	-7.04%
Growth of material goods	-	-9.32%	-23.75%	49.10%	21.70%	-3.10%
Growth of capital goods	-	-9.41%	-17.36%	42.96%	19.70%	-10.80%

Further, we look at Indonesia’s manufacturing (non oil & gas) growth, export and import. Table 3 shows that indeed textiles and ceramic stuff (under non-metal) seems to struggle. We can say the same in the category containing footwear and plastics. But indeed, in general, outside of electronics (perhaps including vastly invested batteries) and basic metal (basically nickel stuff), Indonesian manufacturing is struggling in 2023.

Table 3. Growth rate of Indonesian industries

Year	18	19	20	21	22	23
nonmigas	4.77	4.34	-2.52	3.67	5.01	4.69
Industri Makanan dan Minuman	7.91	7.78	1.58	2.54	4.90	4.47
Pengolahan Tembakau	3.52	3.36	-5.78	-1.32	-2.34	4.80
Industri Tekstil dan Pakaian Jadi	8.73	15.35	-8.88	-4.08	9.34	-1.98
Industri Kulit, Barang dari Kulit dan Alas Kaki	9.42	-0.99	-8.76	7.75	9.36	-0.34
Industri Kayu, Barang dari Kayu, Gabus dan Barang Anyaman dari Bambu, Rotan dan sejenisnya	0.75	-4.55	-2.16	-3.71	0.59	1.20
Industri Kertas dan Barang dari kertas, Percetakan dan Reproduksi Media Rekaman	1.43	8.86	0.22	-2.89	3.73	4.52
Industri Kimia, Farmasi dan Obat Tradisional	-1.42	8.48	9.39	9.61	0.69	0.11
Industri Karet, Barang dari Karet dan Plastik	6.92	-5.52	-5.61	1.08	-4.10	-3.63
Industri Barang Galian bukan logam	2.75	-1.03	-9.13	0.89	-2.00	4.11
Industri Logam Dasar	8.99	2.83	5.87	11.50	14.80	14.17
Industri Barang dari Logam, Komputer, Barang Elektronik, Optik dan Peralatan Listrik	-0.61	-0.51	-5.46	-1.62	6.71	13.67
Industri Mesin dan Perlengkapan	9.49	-4.13	-10.17	11.43	11.37	-0.03
Industri Alat Angkutan	4.24	-3.43	-19.86	17.82	10.67	7.63
Industri Furnitur	2.22	8.35	-3.36	8.16	-1.99	-2.04
Industri Pengolahan Lainnya, Jasa Reparasi dan Pemasangan Mesin dan Peralatan	-0.83	5.17	-0.88	-1.64	6.08	-2.10
PRODUK DOMESTIK BRUTO	5.17	5.02	-2.07	3.70	5.31	5.05

Table 4. growth of Indonesian Manufactures non oil and gas import by source

countries	19	20	21	22	23
USA	-11.30%	-8.60%	17.92%	6.72%	-1.11%
EU	-11.58%	-11.12%	8.31%	6.50%	17.18%
ASEAN	-7.56%	-20.58%	27.41%	11.54%	-8.21%
India	-14.91%	-7.83%	72.62%	9.77%	-16.75%
Japan	-12.17%	-31.71%	41.39%	11.66%	-4.95%
South Korea	-5.67%	-11.00%	38.55%	12.58%	-6.00%
Pakistan	-40.88%	-48.26%	-2.23%	-1.22%	62.29%
China	-1.32%	-11.38%	40.05%	21.65%	-7.62%
Australia	-7.77%	-13.23%	106.29%	7.33%	-1.57%

Table 5. growth of Indonesian Manufactures non oil and gas export by source

countries	19	20	21	22	23
Amerika Serikat	0.77%	4.61%	38.56%	9.88%	-18.18%
Uni Eropa	-15.06%	-1.97%	36.59%	16.04%	-20.85%
ASEAN	2.27%	-9.75%	28.59%	26.11%	-15.90%
Jepang	-15.33%	-6.21%	30.60%	37.74%	-18.88%
Korea Selatan	-18.64%	-8.25%	42.32%	33.48%	-19.00%
Pakistan	-19.50%	23.88%	61.01%	11.21%	-32.47%
Republik Rakyat Cina	5.99%	15.48%	70.96%	24.43%	-1.94%
Australia	-2.60%	14.52%	24.18%	7.53%	-7.50%