Sector
Trading
Indonesia, a developing country rich in natural resources and boasting the 4th largest population in the world, maintains an extensive trade presence. In 2023, the national trade balance reached US$480.7 billion, having grown significantly compared to the pre-pandemic period in 2019, when it stood at US$338.96 billion. Moreover, as of March 2024, the country has officially recorded a trade balance surplus for its 47th consecutive month.
View moreOther Sectors
Trading
Indonesia, a developing country rich in natural resources and boasting the 4th largest population in the world, maintains an extensive trade presence. In 2023, the national trade balance reached US$480.7 billion, having grown significantly compared to the pre-pandemic period in 2019, when it stood at US$338.96 billion. Moreover, as of March 2024, the country has officially recorded a trade balance surplus for its 47th consecutive month.
In terms of exports, Indonesia’s top export commodity has historically been mineral-based fuels, especially coal. However, in the global market, Indonesia is a superpower in the exports of vegetable oils, particularly palm oil, having captured roughly 20 percent of the market with a total export value of US$35.2 billion in 2022. Behind that, Indonesia also leads in nickel exports, with a total export value reaching US$5.8 trillion or 14 percent of global exports.
In 2023, China emerged as Indonesia’s top partner for both exports and imports, with a total annual value of US$62.3 billion and US$62.2 billion, respectively. Meanwhile, the nation’s next top export destination is the US, with a total annual value of US$ 23.2 billion, while the next top import country of origin is Japan, with a total annual value of US$ 16.4 billion.
For trades on the level of individual consumers, the main driver of growth has been the rise in e-commerce throughout the past few years. E-commerce gross market value (GMV) grew by 20 percent from US$48 billion in 2021 to US$58 billion in 2022. This growth persisted to 2023, as e-commerce GMV grew by 7 percent to US$62 billion. E-commerce grew rapidly as it provided a means for Indonesian consumers to maintain access to goods and services during the pandemic period of 2020-2022. However, by the time the pandemic ended, e-commerce had grown ubiquitous and became a staple in the day-to-day lives of the average Indonesian.
Meanwhile, the domestic retail sector in Indonesia is driven by the sale of automotives. The retail of automotives alone in the country reached a gross domestic product (GDP) of US$174.35 billion in 2023, contributing to roughly 13.53 percent of Indonesia’s total GDP of US$1.3 trillion for that year at current market prices. Moreover, the country also achieved a per capita GDP of US$ 4,919.
Strong trade growth followed by increasing access to goods has bolstered local consumer confidence in Indonesia despite the period of uncertainty throughout 2023. According to Bank Indonesia’s monthly consumer confidence survey, Indonesians entered 2024 with high confidence, with the confidence index rising from 123.8 in December 2023 to 125.0 in January 2024. Moreover, this increase is even higher compared to same period the previous year, as a consumer confidence index of 123.0 was recorded for January 2023.
Latest News
The flash floods and landslides that ravaged Aceh, North Sumatra and West Sumatra should prompt far deeper scrutiny than they have so far received. While Cyclone Senyar intensified the rainfall, the scale of destruction reflects decades of unchecked ecological degradation that have left communities acutely exposed.
As of Dec. 10, the National Disaster Mitigation Agency (BNPB) reported 969 deaths, 262 missing persons and more than 5,000 injured. The disaster also damaged 157,900 homes and 1,200 public facilities. Economically, the Center of Economic and Law Studies (CELIOS) has placed losses at Rp 68.67 trillion (US$4.1 billion), while BNPB expects recovery costs of at least Rp 51.82 trillion.
Given these figures, it is increasingly difficult to treat the catastrophe as a purely natural event. Since the floods struck on Nov. 25, videos circulating on social media have shown neatly cut logs swept downstream, a stark indication of extensive upstream logging activity and a reminder that severe ecological degradation magnified the impact of extreme weather.
Data from the Environment Ministry, Forestry Ministry and Statistics Indonesia underscore the pattern. In 2024 alone, net deforestation reached 11,208 hectares in Aceh, 7,035 ha in North Sumatra and 6,634 ha in West Sumatra, together accounting for 24,877 ha, or 14.2 percent of Indonesia’s total net forest loss that year. Just five years earlier, the combined figure in these provinces stood at 3,926 ha, or 3.4 percent of the national total.
Not only are these provinces losing trees rapidly, they are experiencing one of the steepest upward trends in deforestation nationwide. Reforestation efforts lag far behind: over the past five years, forest rehabilitation in the affected areas has never exceeded 20 percent of the land cleared. The gap points to systemic failures in forest governance and long-standing neglect of Sumatra’s ecological vulnerabilities.
The government has acknowledged the environmental dimension of the disaster. Forestry Minister Raja Juli Antoni said at least 12 companies in North Sumatra were suspected of violating environmental regulations, and the ministry is preparing to revoke 20 Forest Utilization Business Permits (PBPH) covering 750,000 ha across the three provinces. He has also asked National Police Chief Gen. Listyo Sigit Prabowo to investigate the origins of the logs filmed drifting through towns during the floods, raising the possibility of widespread illegal logging.
In parallel, Environment Minister Hanif Faisol Nurofiq has taken action by stopping the operation of four firms accused of intensifying ecological pressures in upstream areas: PT Agincourt Resources, PTPN III, PT North Sumatera Hydro Energy and one unnamed company.
Despite these moves, President Prabowo Subianto has so far avoided linking the tragedy to deforestation. His public comments have centered on reconstruction, farmland rehabilitation and microcredit relief for smallholder farmers, priorities aligned with his administration’s food security agenda. But he has offered no indication of whether he intends to confront the environmental drivers that worsened the disaster.
The timing is politically awkward. Prabowo’s recent trip to Islamabad, where he discussed climate cooperation, coincided with growing domestic calls for environmental accountability. While climate change contributes to the severity of hydrometeorological disasters, Indonesians are demanding answers about the deforestation that directly amplified the floods’ impact. The absence of a clear presidential stance risks reinforcing perceptions that the Palace is sidestepping the issue.
Complicating matters further are renewed questions about the President’s own concession holdings. In the 2024 presidential debate, Prabowo acknowledged managing hundreds of thousands of ha in forest concessions. Reports have also linked him to PT Tusam Hutani Lestari, which holds a 97,000-ha concession in the upstream area of hard-hit Central Aceh and is currently led by former Gerindra deputy chairman Edhy Prabowo. In July, President Prabowo said that he had entrusted all of his forest concessions in Central Aceh to the World Wide Fund for Nature (WWF) for elephant conservation.
Taken together, these associations raise potential conflict-of-interest concerns that could weaken the President’s credibility in confronting Sumatra’s environmental crisis.
The scale of the tragedy should mark a turning point in Indonesia’s approach to environmental governance. As long as deforestation remains unaddressed, disasters of this magnitude will recur. Physical reconstruction may restore damaged infrastructure, but without political resolve to tackle problematic concessions, strengthen oversight and recognize the link between policy choices and ecological vulnerability, Indonesia risks being caught unprepared once again when nature exacts its next toll.
