Indonesia was Australia’s 15th largest trading partner in 2018, accounting for 2.1% of total trade. Australian goods and services exports amounted to $8.5 billion in 2018, made up predominantly of crude petroleum, wheat, live animals and coal. Imports from Indonesia amounted to $9 billion–up 17% on 2017–consisting mainly of tourism and petroleum.
Australia also exported $1.7 billion of services to Indonesia in 2018—mostly education and tourism. Some 21,000 students undertook education in Australia in 2018 (3% of the total). More than 208,000 (2% of the total) Indonesian’s visited Australia in 2018, continuing a solid growth trend.
According to McKinsey, the Indonesian consuming class hit 70 million in 2016 and is forecast to increase by 5 million each year to 125 million by 2030. This makes Indonesia the greatest expanding consumer market worldwide. Australia is to benefit from rising Indonesian consumer demand for education, finance, healthcare, information and communications technology, and tourism.
Indonesia is a marginal investor in Australia, owning a portfolio of just over $1 billion in 2018, much lower than US and UK investment in Australia.
The stock of Australia’s investment in Indonesia is larger, at $5.6 billion (0.2% of the total in 2018). However, this is a significant fall from the high of $10.7 billion in 2017 – driven by the selldown of Australian ownership interests in some mining companies, in line with the 2009 Mining Law. The US ($719 billion) and UK ($408 billion) remain the leading destinations for Australia’s foreign investment.