Experts on Trump's Tariffs: Indonesia Isn't Heavily Dependent on US Exports

6 hours ago 3

TEMPO.CO, Jakarta - Director of Prasasti Center for Policy Studies, Gundy Cahyadi, stated that the tariff policy implemented by the President of the United States, Donald Trump, will not significantly affect Indonesia's export market. This is because Indonesia's exports to the U.S. only account for about 10 percent of its total annual exports.

Gundy mentioned that Indonesia's exports to the U.S. are valued at $29 billion, accounting for 10% of its total exports. "If access to the U.S. market is completely closed, it will be felt, but not enough to shake the economic foundation," he said in a written statement on Wednesday, July 16, 2025.

According to him, the loss of access to the U.S. export market is equivalent to a two percent loss in Indonesia's total GDP. He considered the current global trade situation to be more of a political stage rather than a serious long-term policy.

"The global financial market is quite accustomed to this theatrical political style. Investors tend to view tariff threats as part of an established pattern. Threats on the screen, negotiations behind the scenes," he said.

He recommended that the government focus on efforts to encourage investment rather than being confined to the U.S. tariff polemics. He highlighted President Prabowo Subianto's efforts to explore cooperation with various countries as a positive step in the recent global trade situation.

"President Prabowo's decision to attend the BRICS summit despite pressure from President Trump shows Indonesia's consistent foreign policy direction to expand cooperation, strengthen positions, and maintain firmness," he said.

Regarding the tariff policy, Indonesia previously faced a reciprocal tariff of 32 percent. Recently, Trump announced that the tariff rate would be reduced to 19 percent. Trump claimed to have directly negotiated with President Prabowo. "Indonesia will pay the United States a 19 percent tariff on all goods they export to us, while U.S. exports to Indonesia are to be tariff and non-tariff barrier free," wrote Trump via his @realDonaldTrump account, quoted on Wednesday, July 16, 2025.

Additionally, Trump also stated that Indonesia is committed to investing in several American products. The investments include the energy sector worth US$15 billion, agricultural products worth US$4.5 billion, and 50 Boeing aircraft.

Anastasya Lavenia contributed to the writing of this article

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