TEMPO.CO, Jakarta – The Indonesian Trade Ministry plans to cut this year's export target following the price declines of two major export commodities, crude palm oil (CPO) and coal. Initially, the government set the 2014 export target at US$190 billion, which is 4.1 percent higher from 2013's actual export value of US$182.57 billion.
Trade Minister Muhammad Lutfi said the revision will be submitted before the end of his term on October 20.
"The cut may be a bout three to five percent of the initial target. We are still calculating everything," Lutfi told Tempo yesterday.
CPO and coal prices have plunged. In January 2014, CPO price stood at US$920 per metric ton. Nowadays, the commodity is only sold for US$726 per metric ton. Meanwhile, coal prices have been down by about seven percent in the last two months, Lutfi said.
Meanwhile, the World Bank predicted Indonesia will have difficulties in competing with its neighboring countries in the future. The country's dependence on exports is a sign that the economy will slump if global prices go down. For this year, the World Bank projected Indonesia's economy will only grow by 5.2 percent, slower than last year's 5.8 percent.
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