TIME FOR INDONESIA'S EXPORTERS TO LOOK FOR NON-TRADITIONAL MARKETS by Fardah

      Jakarta, Oct 25, 2012 (ANTARA) - Amid a decline in Indonesia's exports lately, hope of new potential markets for its export products was indicated, particularly during the Trade Expo Indonesia 2012.

         Trade transactions at the Trade Expo Indonesia (TEI) 2012 were mainly dominated by purchases from buyers from non-traditional countries.

         Buyers with most transactions came from Nigeria (14.15 percent), followed by Vietnam (1.9 percent), the Philippines (1.18 percent), Algeria (0.36 percent) and Turkey (0.35 percent).

         Other countries interested in Indonesia's products were Saudi Arabia, Jamaica, Zimbabwe, South Africa, Myanmar, Spain, Brunei Darussalam and Colombia.

         Until the second day of the expo, the total trade transaction value exceeded US$106.9 million, consisting of goods transactions worth US$ 22.25 million and services worth US$83.95 million, according to data from the Trade Ministry.

         The transactions of goods were dominated by motor vehicles at 16.94 percent, followed by building materials at 0.72 percent, furniture at 0.71 percent, leather and leather products at 0.59 percent and information technology at 0.47 percent, the Trade Ministry's Director General of National Export Development, Gusmardi Bustami told the press recently.

        Bearing the theme "Trade with Remarkable Indonesia", TEI 2012 - Indonesia's largest trade exhibition held at the Kemayoran fair ground, from October 17-21, was officially opened by President Susilo Bambang Yudhoyono.

         The largest number of participating businessmen, around 70 percent of the total number of participants, came from non-traditional markets such as the Middle East, Africa and South America. They comprised of participants from Nigeria (12.94 percent), followed by Indonesia (9.71 percent), Malaysia (4.95 percent), India (4.69 percent) and South Africa (3.42 percent).

         The theme was selected to reflect the full range of products and services that Indonesia is able to offer, ranging from agriculture commodities, mining products to industrial products and various services.

         Being affected by the global economic and financial crises, Indonesia's exports were down by 12.27 percent in August to US$14.12 billion from US$16.09 billion in July, according to the National Statistics Agency (BPS).

         "The drop is caused by a decline in the value of non-oil/gas exports by 14.49 percent from US$13.17 billion to US$11.26," BPS chief, Suryamin said.

         The value of the country's oil/gas exports also slid by 2.3 percent from US$2.92 billion to US$2.85 billion, following a drop in the exports of oil/gas by 38.12 percent to US$220.5 million and the drop in the exports of gas by 3.19 percent to US$1.66 billion.

         Cumulatively, from January to August the country's exports¿ value also suffered a decline by 5.58 percent from US$134.68 billion to US$127.17 billion.

         Based on cumulative data on destinations, Indonesia's non-oil/gas exports from January to August went mostly to China, valued at US$13.37 billion followed by Japan valued at US$12.57 billion and the US at US$9.9 billion.

        "The total non-oil/gas export market share in the three countries reached 35.41 percent of national exports worth US$101.23 billion," he said.

         Non-oil/gas exports to the ASEAN countries, mostly to Singapore, Malaysia and Thailand, were worth US$25.6 billion, contributing around 25 percent of the country's total non-oil/gas exports.

         Non-oil/gas exports to the European Union, with Germany being the biggest market, were worth US$2.08 billion, followed by Britain at US$1.16 billion and France at US$74 million.

         Because of the decline in exports, a number of businessmen and economists have suggested that Indonesia's exporters start looking for markets in non-traditional countries.

         In his report during the opening of Trade Expo Indonesia 2012 on October 17, Trade Minister Gita Wirjawan said that there was "immense potential for Indonesian export products in non-traditional markets of many developing countries".

          Indonesian Businessmen Association (APINDO) chairman, Sofjan Wanandi called on Indonesian exporters to switch their focus from traditional markets, such as the United States, to new markets such as African and East European countries.

          "The national banking circles should also encourage Indonesian exporters to enter non-traditional markets," he said recently.

    Wanandi also believed that Indonesian products have difficulty in penetrating new markets because they are not sufficiently promoted overseas.

          "Our shortcoming is (a lack of) promotional activities. So far, we have left the job to businessmen. It's not enough," he said while visiting the TEI 2012.

         Wanandi stated that TEI was an appropriate platform for Indonesian exporters to promote their products.

         "At this exhibition, we want both, large and small scale exporters to gain access to their respective markets," he added.

          More encouragement to find new non-traditional markets came from the Director of the Institute for Development of Economics and Finance (Indef), Enny Sri Hartati, who recently stated that Indonesia must find new markets for its exports as part of efforts to
increase its foreign trade.

          "The World Export Development Forum (WEDF) may serve in developing momentum to create a new market for Indonesian exports," Enny said on the sidelines of the forum, organized as part of the TEI.

    She added that if Indonesia can derive maximum benefit from 23 WEDF member countries as export destinations its export value will increase.

         "For instance, if we can make maximum use of 10 of the 23 WEDF member states our exports will increase by around 20 percent," she said.

         Enny added that Indonesia has so far exported its commodities to the WEDF member states but they are still in small volumes and low in value.

         She noted Indonesia's exports have so far relied on traditional markets, such as the United States, China, Japan and European countries. The United States and European countries have been hardly hit by financial crises.

         "Consequently, when demand in the traditional markets drops Indonesia's exports fall accordingly," she said.

         President Yudhoyono in his opening remarks underlined the importance of diversifying market and products to exporters and hence, such a trade expo is valuable to promote products and services and secure transactions; to explore new international cooperation and to provide economic benefits for companies and buyers.

         He also reminded the audience that the world economy was in a gloomy state and despite difficulties Indonesian exports have continued to grow at an average rate of 29 percent in the past few years.

         The head of state affirmed that Indonesian exports must grow or at least remain at current levels in the midst of a global slow-down, so that they may contribute to growth.  
    "To penetrate global markets, Indonesian exporters need to diversify destinations and exported products or services,¿ he noted.

    Earlier, Minister Gita Wirjawan expressed optimism that the transaction target of US$2 million at the Trade Expo Indonesia 2012 was achievable.

         "It is an ambitious target, but we are sure it's achievable. It will be easier with the support of bank funding and export guarantee schemes," he said.

         Some 1,300 business organizations took part in the expo, which was attended by some 5,300 "potential buyers" from 100 countries.

    "TEI is a world-class business-to-business exhibition promoting various Indonesian export commodities," he added.

         This year's participants included state-owned companies, small and medium-scale industries and cooperatives, who offered various export commodities such as automotive spare parts, cacao, coffee, oil, textiles, footwear and handicraft.

         In last year's expo, India accounted for 11 percent of the total trade transactions, followed by Nigeria (7 percent), Britain (5 percent) and Japan (5 percent).

          Trade Expo Indonesia 2011 attracted more than 8,300 buyers from over 100 countries and recorded trade transactions worth US$225.9 million for merchandise and US$238.5 million for skilled labour. ***2***
(f001/INE/a014)