PERKEMBANGAN NERACA PERDAGANGAN DAN FAKTOR-FAKTOR YANG MEMPENGARUHINYA

This paper examines the development of Indonesia's trade balance and its determinant factors from the first quarter of 2006 to the second quarter of 2013 using a Vector Error Correction Model (VECM). The development of trade balance from the year 2006-2011 has shown a positive trend. However between the year 2012 and 2013, the trade balance has been negative.The analysis shows that both in the short run and the long run,the domestic consumption and Real Exchage Rate have negative and significant influence on Indonesia's trade balance. Whilst Foreign Direct Investment and Foreign GDP have positive effect. The coefficient of Error Correction Model is negative and significant implying that there is correction movement from those variabels in the long run. This study suggests that the Government should make the right policy to overcome the deficit of trade balance by maintaining including exchange rate stability,and household consumption of imported goods as well as by attracting Foreign Direct Investment.