Indonesia Evaluates Trump’s Tariff Impact on Exports and National Economy
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JAKARTA, Investortrust.id – The Indonesian government has begun assessing the economic impact of new US tariffs under President Donald Trump, warning of significant consequences for the country’s export competitiveness. The move comes after the United States formally imposed a reciprocal tariff of 32 percent on Indonesian goods, effective Wednesday, April 9, 2025.
Coordinating Minister for Economic Affairs Airlangga Hartarto said the government is evaluating the effect of the new tariff policy on several key sectors, including electronics, textiles, footwear, palm oil, rubber, furniture, and seafood. These products constitute Indonesia’s primary exports to the US market.
“The Indonesian government will immediately calculate the impact of the US reciprocal tariff on these sectors and on the broader economy,” Airlangga said in a written statement on Thursday, April 3. “Strategic steps will be taken to mitigate negative effects on Indonesia’s national economy.”
The 32 percent tariff, announced on Wednesday, is derived from a 10 percent base tariff plus additional levies based on current US trade practices. It is part of President Trump’s renewed push for reciprocal trade measures targeting countries with large trade surpluses with the United States.
Airlangga emphasized that the government, in collaboration with Bank Indonesia, is committed to maintaining the stability of government bond yields and exchange rates amid global financial volatility. The central bank will ensure that foreign exchange liquidity remains adequate to support business needs and maintain overall economic stability.
Since early 2025, Indonesian ministries and agencies have been coordinating with Indonesian representatives in Washington D.C. and domestic business leaders to prepare for such tariff actions. Airlangga said that a cross-ministerial team has been in continuous contact with the US government and that a high-level delegation would soon travel to Washington to negotiate directly.
The negotiations will respond to concerns raised in the United States Trade Representative’s 2025 National Trade Estimate Report, which outlined various issues with Indonesia’s trade policies, including non-tariff barriers.
President Prabowo Subianto has instructed his administration, known as the Red and White Cabinet, to adopt structural reforms and regulatory simplification, particularly in areas deemed restrictive to trade. These reforms are aimed at boosting market confidence and attracting investment to sustain economic growth.
To strengthen its position, Indonesia has also reached out to Malaysia, which currently holds the ASEAN chairmanship, to coordinate a regional response, as all 10 ASEAN members are affected by the US tariff hike.
Lawmakers Demand A Swift and Strategic Response
House of Representatives member Hanif Dhakiri, Deputy Chair of Commission XI, called Trump’s tariff move a serious warning to Indonesia’s labor-intensive industries and urged the government to take decisive action.
“This is not just about trade. It’s a direct blow to millions of workers. The government cannot remain a bystander—it must take full control,” Hanif said on Thursday.
He cautioned that failure to act decisively could trigger falling exports, job losses, rising inflation, and weakened purchasing power. The rupiah may also face pressure, potentially slipping to Rp 16,675 per US dollar, despite Bank Indonesia’s intervention using more than $4.5 billion in foreign reserves.
“Monetary policy is important, but without a strong fiscal and real sector strategy, our economy will stumble,” he added.
Commission XI Chair Mukhamad Misbakhun also urged the government to respond cautiously and thoroughly assess the risks and benefits of the new US tariff policy.
“The government must take a prudent approach in calculating the impact of these US tariffs on Indonesia’s overall economic performance,” Misbakhun said.
He stressed that the aggressive trade stance from the US under Trump would significantly burden Indonesian exports and called for unified efforts from all stakeholders to confront the challenge.