TEMPO Interactive, Jakarta:The government should watch closely the declining trend in the trade surplus. In the first half of last year, trade surplus was recorded at US$16.1 billion. But, in the same period this year, the surplus plunged by 97 percent to only US$477 million. Conditions this year are increasingly alarming because in the last three months the trade balance has recorded a deficit. Two factors are of critical concern to the government: the declining tendency in the surplus of non-oil and gas trade and the increasing deficit of oil and gas trade. In the first half of last year, both the oil and non-oil sectors still recorded a surplus. This year, conditions are very different. During the first six months, the non-oil and gas sector was still enjoying a surplus, but the numbers are declining steadily, while the deficit in the oil and gas sector is trending upwards. The deficit in one sector is slowly devouring the surplus in the other. If this trend is left unchecked, it is likely that Indonesia will record a deficit at the end of the year. That will weaken Indonesia's economy as exports are one of the key drivers of economic growth. Its contribution to gross domestic product is about 25 percent. If the surplus plunges even further, Indonesia's economic growth target of 6.5 percent in 2012 will be difficult to achieve. The signs are visible now. In the first quarter, the economy rose only 6.3 percent, and, based on an estimate by Danamon, in the next three months the growth will be even less, 6.04 percent. Therefore, the government must compensate for the weaknesses in exports. Over the past two decades, Indonesia has been relying very heavily on the major markets, namely the United States, Japan, European Union, and ASEAN. And lately, on the emerging China. The government has promised to boost export growth to non-traditional areas, such as Africa and Latin America. Unfortunately, these efforts do not provide optimal results because the role of the main regions is still very large. Once they fell, Indonesia's exports started to free fall as well. The government can also encourage domestic consumption. However, those attempts are useless as long as the government fails to suppress the consumption of subsidized fuel. High fuel consumption is the culprit for the increase in oil imports. Until June alone, subsidized fuel consumption has reached 21.7 million kiloliters, or about 1.7 million kiloliters above the ceiling of subsidy by the government in the State Budget Amendment in 2012. This not only adds to subsidies, but also puts pressure on Indonesia's trade. The government has no choice but to accelerate the subsidized fuel savings program. Unfortunately, it seems to have stalled. Another option is to immediately raise fuel price to reduce fuel consumption and simultaneously reduce subsidies. Without efforts to expand into non-traditional export markets and suppress fuel consumption, it is difficult for Indonesia to avoid the possibility of trade deficits.*****