JakartaPost/Reuters-July 8, 2025
Indonesia has yet to secure lower tariffs from the United States despite a range of concessions it put on the table. Experts caution that striking a trade deal may be “too complex” a task. Coordinating Economic Minister Airlangga Hartarto was set to meet US negotiators on Tuesday for more talks on bilateral trade, hours after US President Donald Trump sent a letter to President Prabowo Subianto reiterating his threat to impose a 32 percent tariff on all Indonesian exports. Airlangga is scheduled to sign a memorandum of understanding (MoU) in Washington for trade deals worth up to US$34 billion with American business partners. The agreement will include $15.5 billion in US fuel imports as well as investment plans involving state-owned enterprises (SOEs) and state-run asset fund Danantara Indonesia. However, it remains unclear whether the agreement has been finalized. As part of the effort, the Indonesian Wheat Flour Producers Association (Aptindo) signed a $250 million deal with US Wheat Associates on Monday to import 1 million tons of wheat annually through 2030, executive director Ratna Sari confirmed to the Post on Tuesday. Jakarta has also offered to cut tariffs on key American exports, including agricultural products, to near-zero from between 0 percent and 5 percent at present, “depending on how much [of a reduction in] tariffs we get from the US”, Airlangga said on Thursday. The government had asked Washington for preferential access for its own exports, including electronics, footwear and textiles, Coordinating Economic Ministry Secretary Susiwijono Moegiarso said. In a letter dated Monday and posted to Trump’s Truth Social account, the US president said the 32 percent import tariff on Indonesian goods, now set to start on Aug. 1, was needed to correct “very persistent” trade imbalances caused by Indonesian tariff and non-tariff barriers. “There will be no tariff if Indonesia, or companies within your country, decide to build or manufacture products within the United States,” Trump wrote. The letter also warned that any retaliatory steps, including transshipments, would be met with even steeper duties. Read more at:
