Indonesia has recorded a striking trade surplus of US$4.33 billion for March 2025, a figure that has caught the attention of economists and policymakers alike. Driven by a surge in exports to the United States ahead of looming import tariffs, the data released by Statistics Indonesia (BPS) on April 22, 2025, highlights both the resilience and the vulnerabilities of Southeast Asia’s largest economy. As global trade tensions escalate, particularly with the US under President Donald Trump’s administration, Indonesia finds itself navigating a delicate balance between capitalizing on current opportunities and bracing for potential economic headwinds.
A Record-Breaking Surplus
The March surplus, which surpassed the previous month’s figure of US$3.1 billion, marks Indonesia’s 59th consecutive month of positive trade balance, a streak that began in May 2020. According to BPS head Amalia Adininggar Widyasanti, the US played a pivotal role in this achievement, contributing a non-oil and gas trade surplus of US$1.98 billion—the highest since March 2022. Key commodities driving this growth include electrical machinery, footwear, and crude palm oil (CPO), with the US absorbing significant portions of Indonesia’s exports in apparel (63 percent) and footwear (34 percent) during the first quarter of 2025. 
This export boom comes at a critical juncture, as US tariffs introduced in April 2025 have prompted exporters to accelerate shipments. Economists suggest that the rush to beat the tariff deadline may have inflated March’s figures, a point echoed by Bank Danamon economist Hosianna Evalita Situmorang. She noted that freight bookings at Chinese ports dropped sharply in the same period, hinting at broader trade disruptions that could soon impact Indonesia. “Exporters accelerated shipments ahead of Trump’s tariffs” said Hosianna, underscoring the urgency felt across the region.
Domestic Demand and Import Trends
Despite the export surge, Indonesia’s import growth of 5.34 percent year-on-year in March fell short of the anticipated 6.6 percent, according to SSI Research economist Fithra Faisal Hastiadi. This slower growth, particularly during the Ramadan and Idul Fitri holiday season when domestic demand typically spikes, points to underlying pressures on household spending. “The lower-than-expected import growth during Ramadan reflects sluggish domestic demand” said Fithra, suggesting that economic challenges persist despite the trade surplus.
On the other side of the trade ledger, Indonesia continues to grapple with a significant deficit with China, amounting to US$1.1 billion in March. While this figure is lower than the deficits recorded in January and February (US$1.77 billion and US$1.75 billion, respectively), it underscores Indonesia’s reliance on Chinese imports and the structural imbalances in its trade relationships. Efforts to diversify export markets, particularly within ASEAN, India, and Europe, are underway, supported by Bank Indonesia’s accommodative policies, but the road ahead remains uncertain.
Commodity Dynamics and Global Pressures
A deeper look at Indonesia’s export composition reveals both strengths and vulnerabilities. Iron and steel exports saw a robust increase of nearly 20 percent in March, bolstered by rising volumes and prices, likely driven by Chinese industries stockpiling raw materials post-Chinese New Year. CPO shipments also grew impressively by 41 percent year-on-year, reflecting strong demand in key markets like the US. However, coal exports plummeted by 23.14 percent year-on-year, a decline attributed to weakening global demand amid trade tensions and shifting energy priorities.
Bank Permata chief economist Josua Pardede cautioned against over-attributing the export surge to tariff avoidance, pointing to seasonal factors such as the post-Chinese New Year period in March. “The preliminary assumption might be to attribute Indonesia’s rising exports to exporters trying to ship out more goods before US tariffs kick in” said Josua. He added, however, that further verification is needed to confirm this trend, highlighting the complexity of interpreting trade data in a volatile global environment.
Navigating US Tariff Risks
Indonesia’s trade outlook is further complicated by plans to increase imports from the US by US$1.5 billion to US$2 billion per month as part of negotiations to mitigate tariff impacts. This strategy, aimed at placating Washington, includes boosting the share of liquefied petroleum gas (LPG) imports from the US to 85 percent. While this could strengthen bilateral ties, it also exposes Indonesia to risks if US tariffs on key commodities like palm oil escalate. Economists warn that such measures, combined with declining coal prices due to global demand shifts, could erode the gains from recent surpluses.
Hosianna of Bank Danamon emphasized the need for vigilance, noting that while Indonesia’s economic outlook remains resilient, external pressures are mounting. “Risks persist from higher US tariffs on palm oil, as well as from coal prices sliding because of weakening global demand prompted by the trade war” she said. The potential for spillover effects from broader trade tensions, as evidenced by disruptions at Chinese ports, adds another layer of uncertainty to Indonesia’s economic planning.
Regional and Global Implications
Indonesia’s trade performance in March, with a first-quarter surplus of US$10.9 billion compared to US$7.41 billion in the same period last year, positions it as a standout in Southeast Asia. Yet, this success is tempered by the broader context of global economic uncertainties. Escalating trade tensions, particularly between the US and China, have ripple effects that could undermine demand in key markets. For Indonesia, which relies heavily on exports to drive growth, diversifying trade partnerships is not just a strategy but a necessity.
Bank Indonesia’s efforts to buffer external pressures through market diversification and supportive monetary policies are steps in the right direction. A greater focus on ASEAN, India, and Europe as export destinations could reduce Indonesia’s dependence on volatile markets like the US and China. However, building these relationships will take time, and in the interim, Jakarta must contend with immediate challenges posed by tariffs and shifting commodity prices.
Looking Ahead
As Indonesia charts its course through a turbulent global trade landscape, the March 2025 surplus offers a moment of optimism but also a reminder of the fragility of economic gains. The interplay between domestic demand pressures, export-driven growth, and external risks like US tariffs will shape the country’s economic trajectory in the months ahead. With plans to deepen trade ties with the US while diversifying markets elsewhere, Indonesia stands at a crossroads, balancing short-term opportunities against long-term stability.
For now, the resilience of Indonesian exporters and policymakers will be tested as global uncertainties persist. How Jakarta navigates these challenges—whether through strategic trade negotiations or robust domestic reforms—remains an open question, one that will likely define its economic future in an increasingly interconnected world.
