The Importance of Agricultural Export Performance on the Economic Growth of Indonesia: The Impact of the COVID-19 Pandemic

Abstract

The agriculture sector has been affected by the COVID-19 pandemic. In Indonesia, agriculture is the most cultivated sector, especially in rural areas. During the COVID-pandemic, agriculture survived and positively contributed to economic growth. In light of this, this study aimed to investigate the effect of the COVID-19 pandemic on agricultural export and also the impact of agriculture export during the COVID-19 pandemic on economic growth. We also give some recommendations on ways to enhance agriculture export performance during the COVID-19 pandemic. The Indonesia agricultural export quarterly panel data from the years 2012 to 2021 were analyzed with the 2SLS regression model. Agriculture export was used as an endogenous variable and the COVID-19 pandemic was used as a dummy variable to reflect the number of years since the COVID-19 pandemic began. The empirical results demonstrate that agriculture export and the COVID-19 pandemic have positively affected economic growth. A 1% increase in agriculture export and the COVID-19 pandemic may increase economic growth by 0.69% and 0.16%, respectively. In contrast, the labor force and inflation were found to have inverse effects on economic growth. Therefore, we recommend that, during the COVID-19 pandemic, agriculture export should be used as an alternative way to increase economic growth. Policies could be developed to increase the agricultural export value.

Does the COVID-19 epidemic impact on economic sustainability of big agricultural firms in Indonesia?

“…Finding that agricultural corporations in Indonesia have sound business performance despite the virus epidemic corroborates earlier research that used macroeconomic indicators. Our result confirms Arifah IOP Publishing doi:10.1088/1755-1315/1241/1/012050 6 and Kim's [15] argument that agriculture managed to survive the COVID epidemic and continued to make significant contributions to the expansion of the economy.…”

“…The pandemic does not have an effect on the export value of Indonesian farming commodities but rather on the volume of exported agricultural products. Similarly, Arifah and Kim [15] give evidence that agricultural production continued and even contributed to economic expansion despite the COVID outbreak. However, a study reveals that there was a negative abnormal return within two days after Joko Widodo, the leader of the Indonesian Republic, announced the initial occurrence of COVID-19 infection in the country.…”

Influence of Export and Import Activities on Economic Support in the Aceh Region

“…The problem was not contended to determine factors of country competition among the benefits to increasing the economy in the world. An advantage of opening the economy world state was balanced payment values (Arifah et al, 2022). The other case for sold and bought systems were described as transactions in the exporting.…”

The contribution of agricultural crop production towards the economic growth of Indonesia’s agricultural sector

“…According to Ruslan and Prasetyo [4], the agricultural sector contributes to the national economy and generates foreign exchange. Cheng [5][6][7] emphasized that the agriculture sector is essential and contributes to economic development.…”

“…These conditions do not necessarily affect the growth of AgriGRDP. AgriGRDP is significantly influenced by plantation crop production (PPC) [4,6,[13][14][15]. Food crop production (PFC), which includes rice, corn, soybeans, and other crops, significantly affects AgriGRDP [5,6,[15][16][17].…”