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Indonesia runs a $20.5 billion trade deficit with China, raising concerns

The deficit has prompted worries that cheaper Chinese imports are displacing domestic producers in sectors like textiles and manufacturing.

Reported · Written up by our desk · Trade & Tariffs

China and Indonesia have deepened economic ties since the Bandung conference in April 1955, but those links now come with financial undercurrents that need attention, according to SCMP Economy.

China is described as the world’s second-largest economy and Indonesia as the largest in ASEAN, with China labeled Indonesia’s top trading partner. China is also characterized as Indonesia’s largest trading partner and a top-three investor there over the past five years, reflecting rapid growth in bilateral commerce.

Still, SCMP Economy reports that Indonesia recorded a US$20.5 billion trade deficit with China last year. The outlet says some observers attribute the rise in Chinese imports, particularly high-quality and affordable goods, to concerns that it is displacing Indonesia’s domestic producers, especially in textiles and manufacturing.

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