Judul : Trump Implements 32 Percent Reciprocal Tariff on Indonesia, Effective August 1, 2025
link : Trump Implements 32 Percent Reciprocal Tariff on Indonesia, Effective August 1, 2025
Trump Implements 32 Percent Reciprocal Tariff on Indonesia, Effective August 1, 2025
Best for you U.S. President Donald Trump once again shook the international trade world with a controversial decision.
In his official statement uploaded through the social media platform Truth Social on Tuesday (7/8/2025), Trump announced the implementation of a 32 percent reciprocal tariff on all products from Indonesia entering the US market, effective August 1, 2025.
This policy was announced through an open letter to the President of the Republic of Indonesia, Prabowo Subianto, which was also publicly broadcast.
The letter conveys the reasons for the policy and the conditions that can free Indonesia from the burden of these tariffs.
Motif and Strategy: Repeating the Protectionism Era of Trump
This reciprocal tariff policy is part of the protectionist approach that has become a characteristic of Trump's second term administration.
This strategy targets countries considered to impose high tariff and non-tariff barriers against American products, with the aim of "opening market access and correcting chronic trade imbalances."
"Deficit is a major threat to our economy and even to our National Security," wrote Trump in his letter.
Trump considers Indonesia as one of the countries that have taken great advantage from free trade, without providing a balanced reciprocity to the US.
Indonesia, according to Trump, has imposed various high tariff barriers, import quotas, and regulations considered discriminatory against American products.
Not Applicable If Production Moves to the US
One key point in Trump's letter is that the 32 percent tariff will not apply to Indonesian companies that choose to move their production base to the United States.
This is a strong signal to promote industrial relocation as part of the "Bring Jobs Back to America" economic strategy, which has been Trump's slogan.
“Kami akan mempercepat proses perizinan hanya dalam hitungan minggu, secara profesional dan efisien,” ujarnya, menawarkan insentif administratif bagi perusahaan asing yang bersedia berinvestasi langsung di AS.
Additional Tariff Threat If Indonesia Retaliates
Trump also issued a strong warning that if the Indonesian government responds with an increase in tariffs on US products, the retaliatory tariff value will be directly added to the base tariff of 32 percent, making the potential total tariff jump significantly.
This policy is seen by many analysts as an effort to prevent the escalation of trade wars, but with a very aggressive and one-sided approach.
Background of US-Indonesia Trade
The United States is one of Indonesia's main trade partners, with the total value of bilateral trade reaching approximately US$40 billion in 2024, according to data from the Ministry of Trade of Indonesia.
Indonesia's trade balance with the US shows a significant surplus for Indonesia, especially from exports of textile, footwear, electronics, and agricultural products such as rubber and coffee.
However, this surplus is seen by Trump as a form of inequality that needs to be corrected through fairer trade policies.
Potential Impact on Indonesia's Economy
Imposing a 32 percent tariff could have a significant impact on Indonesia's exports, especially sectors that have long relied on the US market.
The textile and garment sector, for example, is at risk of losing price competitiveness due to significant tariff increases. Products such as assembled electronics, furniture, and processed agricultural products are also predicted to be affected.
If not responded to strategically, this policy could trigger a decline in exports, mass layoffs in the labor-intensive industry sector, and a reduction in foreign exchange inflows.
Global Responsibility and Potential Disputes in WTO
Such unilateral tariff policies are likely to attract the attention of the World Trade Organization (WTO).
Indonesia can file a complaint through the international trade dispute mechanism if it considers this policy as a form of trade discrimination or a violation of the most-favored-nation (MFN) principle.
In addition, other developing countries that have experienced similar policies from the US could form diplomatic or economic alliances to pressure America to return to a fair multilateral trade path.
Indonesia's Position: Waiting for Official Response
Until this news was released, the Indonesian government has not issued an official statement regarding the new tariff policy.
However, a source from the Ministry of Trade stated that Trump's measures are being thoroughly reviewed by the inter-ministerial team.
President Prabowo Subianto, who has been in office since October 2024, faces his first major diplomatic test in bilateral trade relations.
Whether it will take the negotiation path, the tariff response, or pursue the international legal route remains a big question.
The Beginning of the Trade War or Strategic Negotiations?
President Trump's move to impose a 32 percent reciprocal tariff on Indonesia is not just an ordinary trade policy.
This could be the starting point of a new trade tension in Southeast Asia, or rather an opportunity for Indonesia to reform its export strategy and strengthen its industrial resilience. (*)
Source: Tribunnews.com
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