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The international trade that has been taking place all over the world is known to have been affecting the economy of the involved nations. International trade is known to have been impacting the gross domestic product rate of the nations involved which in turn affects a large share of the international economy. Imports of natural resources within the countries are known to have been detrimental to the economy of the concerned nations. The following paper attempts a discussion on the various negative impacts faced by the Indonesian economy due to the high amount of the imports of the several natural resources.
The major detrimental impacts of the import of natural resources within the country of Indonesia tend to help develop a society that is consumptive in nature. Shandra, Restivo and Sommer (2019) opine that the societal conditions as have been present within the territorial boundaries of Indonesia tend to have been dealing with the issues of the increase in the consumption of the imported materials. According to the reports by Ceicdata.com (2019), there has been observed a huge increase of around 7050 barrels per day in the imports of crude oils within Indonesian markets within the time span of one year from 2017 to 2018 (Refer to Appendix). Increase in the consumptive nature of the society leads to the creation of the inequality within the society. This results in the increase in the poverty within the country as well. Uddin et al. (2017) further states that the import of the natural resources within the Indonesian territories generally influence the lifestyle as is maintained by the residents of the country. Thus, it might be stated that the influence of the importing within the country has led to the conditions wherein the residents of the country has been addicted to the use of the imported products and services. This suggests that the residents of the country tend to be highlighting the conditions of maintaining a higher cost of living which leads to the lowering of the economy within the country.
The importing of the natural resources within the Indonesian economy however leads to the exponential growth of business organizations that are present within the territorial boundaries of Indonesia. Increase in the exponential growth of the companies active in the Indonesian markets is beneficial for the economic growth of the country However, according to the arguments of Restivo, Shandra and Sommer (2018), the practices of importing the natural resources within the given country might have detrimental effects on the overall economic growth of the country. Importing natural resources within the country might in the long run lead to the unsustainability of the economic conditions within the country. Prolonged importing on the part of the country might further lead to continuation of unethical practices within the organizations. The arguments of Cordner (2018) seconded that imports are in fact detrimental to the economic and the financial growth of the country as well. Several unethical practices that are implemented by the business organization due to the long-term importing activities might in turn lead to the conditions wherein the organizations involved would be facing issues due to the non-maintenance of the ethical factors within the activities of the companies.
The increase of the importing of natural resources within the territorial boundaries of Indonesia leads to the overshadowing of the local companies by the international companies. Increase in the importing of the natural resources is easier for the various multinational organizations that are present and active within the territorial boundaries of the country. Im (2019) emphasizes that the local companies that are operational within the territorial boundaries of the country tend to be lacking in the capabilities of importing the natural resources within the country. Imports would lead to the increase in the production costs that are incurred by the company. Increase in the production costs would rather lead to the increase in the cost of the product or the services that are offered by the company. The arguments presented by Moak and Lee (2015) put forth that the increase in the production costs to be one of the primary reasons for the decrease in revenue that is earned by companies operational in Indonesia. Low amount of the revenues earned by Indonesian companies tend to have been affecting the overall economic advancements maintained by Indonesia in the global markets.
On the other hand, certain experts hold the viewpoint that importing of natural resources within the country is known to have been helpful in the improvement of the quality of the products and the services within the country as well. Increase in the imports help the economy of the country through the increase in the earnings of the foreign exchanges within the country. On the contrary Mihi? et al. (2019) states that the increase of the foreign exchange however does not help in the economy within the country since the imports within the country leads to the lack of the tenacity to look for the same resources within the country itself. This lack on the part of the country and the government in turn leads to the lack in the development of the country on the economic grounds as well. Indonesia has been importing natural resources from all over the international markets which in turn leads to the decrease in revenue earning of the country. However, Umezulike (2016) opines that the lack in the revenue earning would thereafter affect the economic conditions that are presented within the country. Increase of the imports within Indonesia would in turn lead to the limitation of the market share of the domestic products as are produced within the country. This in turn lowers the economic conditions of the country as well.
In lieu of the above discussion, it can be stated that the long-term imports within the country has proven to be detrimental to the economic conditions that are maintained by the country in the international markets. Imports of the natural resources within the country has often been observed to have led to the conditions wherein the residents of the country have been maintaining a consumptive nature of lifestyle. Increase in the consumptive nature of the society leads to the creation of the inequality within the society. Thus, it might be concluded that the long-term imports are actually detrimental to the economic development of Indonesia.
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