Indonesia’s August trade balance swings to deficit

JAKARTA, Oct 1 (AFP) : Indonesia's trade balance unexpectedly swung back to a deficit in August, official data showed Wednesday, a setback for Southeast Asia's top economy as it struggles to recover after a turbulent period.
However, while the statistics agency attributed the $318.1 million deficit to a surge in imports it added that most were capital goods, such as machinery for manufacturing, as opposed to consumer goods.
The government is trying to ramp up manufacturing and wean itself off imports of consumer products as it tries to get people, especially the emerging middle class, to buy Indonesian rather than foreign goods.
The market had expected the trade balance to remain in surplus for a second consecutive month.
"This will put pressure on Indonesia's current account deficit, which had been improving on the back of better trade numbers because imports were falling," Kenny Soejatman, an economist from Manulife Asset Management Indonesia, told AFP.