Washington (TDI): US President Donald Trump announced reaching a trade agreement with Indonesia. Trump, on Tuesday, said that the US would impose a 19% tariff on Indonesian goods under the new deal.
This is significantly below the 32% that the President had earlier threatened Indonesia with. It remains unclear when this new tariff rate will take effect. On the occasion, Trump also added that letters setting tariff rates for dozens of other smaller countries will follow soon.
“As part of the Agreement, Indonesia has committed to purchasing 15 billion Dollars in US Energy, $4.5 billion in American Agricultural Products, and 50 Boeing Jets, many of them 777’s,” Trump wrote on Truth Social.
Earlier, Trump said that Indonesia is going to pay 19% and the US is going to pay nothing, also claiming that the country will have full access to the Indonesian market.
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Indonesia is a minor trading partner of the US and does not even rank in the top 15, but the bilateral trade between the two countries has been growing. In 2024, US exports to Indonesia rose 3.7% while imports from Indonesia were up by 4.8 per cent, leaving the US with a trade deficit of nearly $18bn.
Trump said that under the deal, which was finalized after he spoke with Indonesian President Prabowo Subianto, goods that have been transshipped to avoid higher duties would face steeper levies.
According to US Census Bureau data from the International Trade Centre’s TradeMap tool, the top US import categories from Indonesia last year include palm oil, electronics equipment, including data routers and switches, footwear, car tires, natural rubber, and frozen shrimp.
Since the launch of Trump’s tariff policy, he has been able to achieve only a few significant trade deals, including with Vietnam and Britain, falling short of earlier promises to land “90 deals in 90 days”.
An IR student whose interest lies in diplomacy and current affairs and a part time debater
