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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.
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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.
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Domestic workers work long hours and do all kind of chores for low wages and have little or no legal recourse in case of harassment or abuse, as they are completely at the mercy of their employers, or “masters” in this system of modern slavery that persists in Indonesia.
At least, that was until the House of Representatives passed the Law on Domestic Workers Protection (UU PPRT) on April 21. Among the rights and protections it guarantees, millions of domestic workers, mostly women, will gain legal status and recognition for the first time.
The Domestic Workers Protection Bill had lingered at the House for more than 22 years, indicative of a lack of enthusiasm and sense of urgency, not only on the part of legislators but also the general public. President Prabowo Subianto, in his Labor Day address last year, promised the bill would be passed within three months.
The House missed that deadline but enacted the law in time for May Day 2026 with little fanfare, to judge by the scant attention mainstream media gave the milestone legislation. Nevertheless, the new law could impact the way millions of families across the country treat their servants. And therein lies the rub.
While the law lists the various rights and obligations that must be met by all stakeholders, employers, workers and related businesses such as home cleaning services, it falls short on details related to enforcement and more importantly, oversight.
For example, the law mandates a formal employment agreement that outlines the employee’s rights and the employer’s obligations. But any negotiation between the two sides would involve an unequal power relationship and most likely result in an unfair contract for the domestic worker.
Furthermore, the law merely stipulates entitlements such as “decent wages”, “humane working hours”, “breaks and days off” and “holidays” to be determined by mutual agreement and does not set a legal framework.
It does, however, stipulate a minimum age of 18 as well as the provision of health, social and employee insurance for domestic workers. If employers register their servants for such coverage, and that is a big if, the government will contribute a share of the premium and provide social assistance.
The new law does not set a minimum wage or maximum working hours, which would be expected in a labor law.
Though it offers some protection for domestic workers, the new law also protects the interests of domestic employers. Oversight is a critical issue, and the legislation does not make clear who is responsible for contractual enforcement, provided that one is signed, or how violations will be dealt with.
Lita Anggraini, coordinator of the National Advocacy Network for Domestic Workers (Jala PRT), welcomes the new legislation but says it only covers 75 percent of the obligations covered in Convention No. 189 of the International Labor Organization.
The treaty guarantees domestic workers the same basic rights as all other employees and sets standards for fair working conditions, including reasonable working hours, weekly rest and protection from employer abuse.
Jala PRT said it received 1,184 reports on violence against domestic workers, including 26 cases of sexual violence in 2025, though it noted that many more cases of violence went unreported.
Domestic workers are typically tasked with cleaning, washing clothes, cooking, babysitting and accompanying children to and from school. In the absence of legal protection, it is not uncommon for them to be subjected to bullying, harassment and worse at the hands of employers or their family members. The way domestic workers in Indonesia are treated, with long hours, meager pay and harsh working conditions, sometimes involving abuse, their employers would be liable under antislavery laws in Western countries. But no one in Indonesia is talking about phasing out these jobs or introducing antislavery legislation.
The ILO estimates that as many as 5 million Indonesians, mostly women, are employed in domestic service. Millions also work in this sector abroad, including in Hong Kong, Malaysia, Saudi Arabia, Singapore and Taiwan. In fact, the Indonesian government has insisted on overseas employers signing contracts with specific salaries and working hours as well as legal protections in some of these countries.
Ironically, many civil society organizations that are actively demanding protections for Indonesian migrant workers abroad are less passionate about or simply turning a blind eye to legal protections for domestic workers at home.
The Domestic Workers Protection Law promises to improve the lot of domestic workers but not much beyond legal recognition. Urban Indonesians need housemaids, and want them cheap.
