Indonesia’s economy suffered greatly in the late 1990s, in part as a result of the financial crisis that struck most of Asia at the time. The economy has stabilized somewhat since then.
The country has extensive natural resources outside of Java, including crude oil, natural gas, tin, copper and gold. Indonesia is the world’s second largest exporter of natural gas, though it has recently become a net importer of crude oil. Major agricultural products include rice, tea, coffee, spices and rubber. The central bank of Indonesia is Bank Indonesia 1.
Indonesia’s major trading partners are Japan, the United States and the surrounding nations of Singapore, Malaysia and Australia.
Despite being the only Asian member of OPEC, Indonesia’s fuel production has declined significantly over the years, owing to aging oil fields and lack of investment in new equipment. As a result, despite being an exporter of crude oil, Indonesia is now a net importer of oil and had previously subsidized fuel prices to keep prices low, costing US$ 7 billion in 2004. The current president has mandated a significant reduction of government subsidy of fuel prices in several stages. In order to alleviate economic hardships, the government has offered one-time subsidies to qualified citizens. The economy is now undergoing a process of rebuilding after the tsunami that struck in December of 2004. The government has stated the cuts in subsidies are aimed at reducing the budget deficit to 1% of gross domestic product (GDP) this year, down from around 1.6% last year.