Indonesian president Joko Widodo: the US will impose a 19% tariff on Indonesian goods

Indonesian president Joko Widodo: the US will impose a 19% tariff on Indonesian goods

On Tuesday, July 16, U.S. President Donald Trump announced a new trade agreement with Indonesia, which includes a 19% tariff on Indonesian goods. The agreement, finalized after direct negotiations with Indonesian President Joko Widodo, marks a significant shift in U.S. trade policy [1].

Trump emphasized that the deal allows the U.S. to have full access to the Indonesian market, while Indonesian goods will face a 19% tariff. He also mentioned that the U.S. will not impose any tariffs on Indonesian exports, making it a one-sided agreement in favor of the U.S. [1].

The agreement comes amidst a broader push by the Trump administration to reset trade terms with countries running surpluses against the U.S. This deal is part of a series of similar agreements, with Trump indicating that talks with India are moving along a similar line [2].

Indonesia, a relatively smaller U.S. trade partner, saw its exports to the U.S. increase by 4.8% last year, while U.S. exports rose by 3.7%. The U.S. goods trade deficit with Indonesia currently stands at $18 billion [2].

The agreement with Indonesia mirrors a recently announced preliminary deal with Vietnam, which includes flat-rate tariffs on exports to the U.S., zero levies on U.S. goods exported to those countries, and penalties for transhipments targeting Chinese goods [2].

The Indonesian government is preparing a joint statement with the U.S. that will detail additional information, including non-tariff measures and commercial agreements. This statement is expected to be released soon [3].

The agreement with Indonesia may serve as a template for future pacts, including with India, where policymakers now face the task of navigating a high-stakes negotiation with Trump’s administration. The deal has raised eyebrows in New Delhi, as officials monitor Washington’s increasingly protectionist stance ahead of the crucial August 1 tariff deadline [2].

References:

[1] https://www.newkerala.com/news/o/going-access-india-trump-announces-trade-deal-indonesia-794
[2] https://www.republicworld.com/business/india-us-trade-deal-on-trumps-radar-talks-moving-along-that-same-line-says-us-president-after-indonesia-tariff-pact
[3] https://www.business-standard.com/world-news/trump-announces-trade-deal-with-indonesia-details-yet-to-be-disclosed-125071501433_1.html