By Ying Xian Wong
Indonesia's trade balance swung into a deficit in May, as imports grew while exports fell amid concerns over the conflict in the Middle East as well as U.S. trade tariffs.
Southeast Asia's largest economy posted a trade deficit of $1.61 billion, compared with a $90 million surplus in April, the statistics agency said Wednesday.
The total trade surplus for the first five months of the year stood at $4.03 billion. Indonesia recorded trade surpluses with the U.S., India and the Philippines in Jan. to May.
Indonesia's exports continue to face a heightened risk of falling as geopolitical tensions in the Middle East fuel volatility in global energy markets and disrupt trade flows, Kenanga economists said in a recent note. External demand remains uneven, as slower global growth, trade fragmentation and uncertainty over U.S. trade policy could weigh on demand, they said.
However, higher global energy prices could support Indonesia's coal and other energy-related exports, while efforts to diversity its markets may help cushion external shocks, they added.
Kenanga maintained its 2026 Indonesia export growth forecast at 1.9%, weaker than the 6.1% expansion last year, reflecting a challenging global trade environment.
Exports, which account for around 20% of gross domestic product, fell 5.73% in May from a year earlier to $23.20 billion, weighed by lower non-oil exports, particularly in precious metals, metal ores, iron, and steel.
Imports rose 22.16%from a year earlier to $24.81 billion, due to higher non gas imports, the agency said.
For the five months, exports rose 3.02% to $115.36 billion, while imports jumped 15.24% to $111.33billion.
Write to Ying Xian Wong at yingxian.wong@wsj.com