Factors Affecting Import Demand Of Indonesian TIN By Singapore In The Year Of 1985-2002

Abstract

The target of economic development in Indonesia is to develop the national society as a whole with the surplus condition in the international trading. The government is well aware that the mineral sector provides Indonesia with one ofits major competitive advantages The contribution ofthe mining industry to the economy is needed now, to drive national economic recovery and in the longer term to play a key role in national sustainable economic development. The empirical study in few countries shows that a country that has a high export production enjoys a high rate ofeconomic development rather than a country that has a low export production. Atrade, majors on export, is believed as a motor for the economy. Export can bust up the development ofeconomy in a country and it is also a dominant factor. In Indonesian government balance of trade the tint export is one of the important commodity in mining sector beside oil, gas and chopper. Indonesia as one of the world's four major tin producers, except Brazil close in ore production to Malaysia and China in the late 1980s. Tin ore production was centered on Bangka Island, part of South Sumatra Province. Around 95% of Tins product are exported outside of Indonesia; this tin performance is influenced by market condition. For tint commodity Indonesia own20% of the whole international tin product (Statistic Indonesia 1990). The demand of Indonesian tin by Singapore affected by four variables. The variables are: International Price of Indonesian tint (US Cents/ pound), Exchange value of dollar to rupiah (US $/ Rp), GDP real of Singapore (Sin $), and International Price of Indonesian Aluminum (US Cents/ pound). The purpose ofthe research is to analyze the effect of International Price ofIndonesian tint (US Cents/ pound), Exchange value of dollar to rupiah (US $/ Rp), GDP of Singapore (Sin $), International Price of Indonesian Aluminum (US Cents/ pound) toward import demand of Indonesian tin by Singapore. Research hypothesis based on theory and on data analysis that a demand theory as a general, which the demand theory is the demand of export affected by the price of the related good, the GNP of the imported country, the exchange rate rupiah to Singapore Dollar, and Indonesian tint total product. To reach the purpose ofthe research and hypothesis method, the writer used the time series data regression 1985 - 2002 while for analysing the data usedthe regression linear model. From the regression result that variables joined (F- Test) of International Price of Indonesian tin, Exchange value of dollar to rupiah, GDP Singapore, and International Price of Indonesian Aluminum affect very significant to the import demand of Indonesian tin by Singapore, with high correlation around 0.9503. The coefficient determination shows that 90.3164%. Price of Indonesian tin, Exchange value dollar to rupiah, GDP of Singapore, and International price of Indonesian Aluminum can explain the variation of Import Demand Volume of Indonesian tin by Singapore. And the rest, which is affected by the other variables, is only 9.6836%.