Indonesia seeks negotiations with US on Trump’s tariffs, pledges to ease trade barriers

JAKARTA - Indonesia has pledged to ease trade rules as it seeks to negotiate with the US on the latter’s plan to

impose a 32 per cent tariff

on products from South-east Asia’s largest economy.

President Prabowo Subianto ordered his Cabinet to simplify regulations, including by easing non-tariff barriers, after the US announced the reciprocal tariff on Indonesia, the Coordinating Ministry of Economic Affairs said in a statement on April 3. 

The government is now calculating the impact of the tariff, which will hit mainly export-reliant industries such as textiles, electronics and palm oil, according to the ministry. Officials will send a delegation to Washington to negotiate the tariffs slated to take effect on April 9.

“This is in line with efforts to increase competitiveness, maintain market players’ trust and attract investment to maintain the momentum of economic growth,” the ministry said.

Coordinating Minister for Economic Affairs Airlangga Hartarto held

a video conference

with US Representative Carol Miller on April 1, before the tariff announcement. They discussed potential areas of cooperation between the two nations, including on food like soya beans and wheat, the clean-economy sector such as carbon capture and storage, as well as critical minerals.

Indonesia is also in talks with Malaysia, which is the current chair of Asean, to jointly take steps in addressing the tariffs, the ministry said.

The US is one of Indonesia’s top trading partners, contributing the largest non-oil and gas trade surplus of US$16.8 billion (S$22.4 billion) in 2025, according to official data. Indonesia’s main exports to the US include electronics, textiles, fishery products, footwear and palm oil.

Indonesian Palm Oil Association chairman Eddy Martono urged the government to seek alternative markets and ease rules on domestic market obligation and export duties to avert the US tariffs.

Exports of palm oil to the US may stagnate due to the higher levies, Mr Martono said in a mobile phone message. Indonesia shipped 2.2 million tonnes of palm oil in 2024.

Indonesian Employers Association chairwoman Shinta Kamdani also called on the authorities to make new bilateral deals with the US.

Meanwhile, the government and Bank Indonesia will maintain the stability of government bond yields and the rupiah, as well as foreign exchange liquidity, the Coordinating Ministry said.

Indonesia’s financial markets have been shut since March 28 for the Hari Raya Aidilfitri holidays. They will “reopen on April 8 against a backdrop of aggressive US tariffs and global market turbulence”, Ms Krystal Tan, an economist at Australia & New Zealand Banking Group, said in a note on April 4.

That adds to other domestic sources of uncertainty, including Indonesia’s fiscal standing, the transfer of state-owned enterprises under the Danantara sovereign wealth fund, as well as the central bank’s role in funding the government’s housing programme.

“Investor confidence needs to be restored,” Ms Tan said. BLOOMBERG