TEMPO.CO, Jakarta - The Indonesian government is continuing its efforts to lobby the United States for a reduction in the current 32 percent import tariffs on specific products. Coordinating Minister for Economic Affairs Airlangga Hartarto announced that Indonesia has submitted a second offer to the Office of the United States Trade Representative (USTR) as part of ongoing trade negotiations.
"Indonesia is waiting for feedback, whether there is additional feedback related to the ongoing negotiation process," Airlangga told reporters at Graha Sawala, Central Jakarta, on Wednesday, July 2, 2025.
These negotiations come after U.S. President Donald Trump announced the reciprocal imposition of tariffs on products from several countries, including Indonesia. Originally set to take effect on April 9, 2025, the implementation was postponed for 90 days to allow room for negotiations. The latest development indicates that Trump plans to add a 10 percent tariff on BRICS members, with Indonesia being the newest addition to the bloc.
Here are several key points proposed by Indonesia in the negotiation:
1. Offer of Investment in the Critical Mineral Sector
Indonesia is offering cooperation in the critical mineral ecosystem, including nickel and copper, which are vital for the electric vehicle, military, and high-tech industries. This offer is being made through a partnership between the United States and the Indonesian Investment Authority for Strategic Sectors (Danantara).
"Indonesia also offers critical minerals to the United States through Danantara for investment within the ecosystem," Airlangga said at the Trade Ministry on Monday, June 30, 2025.
Airlangga further explained that critical minerals, such as copper, are highly sought after in the electronics, military, and space industries. "All of them need cables, all of them need copper. We already have copper cathodes, and it is also available from the United States," Airlangga added.
2. Increase in Import of U.S. Products
Indonesia is willing to increase its purchase of American products such as soybeans and wheat, which are not produced domestically, to help balance trade. The government also plans to procure LPG and LNG from the U.S.
This step is expected to help reduce the U.S. trade deficit with Indonesia, which, according to USTR data, reached US$17.9 billion in 2024.
3. Relaxation of Domestic Content Requirement (TKDN)
The U.S. had previously raised concerns about Indonesia's local content requirement (TKDN) regulations, viewing them as obstacles to their products and investments. In response, Indonesia is prepared to relax the TKDN regulations, particularly for the information and communication technology (ICT) sector from companies such as Apple, GE, Microsoft, and Oracle.
"Regarding TKDN, in the meeting with the President, the President asked for the TKDN format to be improved into an incentive-based one," said Airlangga.
4. Deregulation and Import Policy Reform
Apart from addressing complaints through diplomatic channels, the Indonesian government is also reforming several domestic policies. The government is revoking the Trade Ministerial Regulation (Permendag) Number 36 of 2023 in conjunction with Number 8 of 2024, and will replace it with Permendag Number 16 of 2025 and eight other implementing regulations. These new regulations aim to facilitate imports for 10 types of commodities, enhancing Indonesia's export competitiveness.
5. Reduction of Import Tariffs on U.S. Products
The government will also adjust the import tariff rates for products from the U.S. falling under the most favored nation (MFN) category. These tariffs will be reduced from the current 5 to 10 percent down to 0 to 5 percent. "This means reducing the tariff burden by another 5 percent, specifically for products originating from the U.S. under MFN," said Sri Mulyani on Tuesday, April 8, 2025.
The government plans to establish a deregulation task force while continuing to lobby for lower import tariffs with the United States. One of the task force's primary responsibilities will be to improve the Domestic Content Requirement (TKDN) policy.
Alfitria Nefi P and Ilona Estherina contributed to the report.
Editor's Choice: Prabowo Seeks NDB Financing for Indonesia's Development
Click here to get the latest news updates from Tempo on Google News
BRICS Not Seeking Confrontation Amid Trump's Tariff Threat, China Says
1 jam lalu
China announced on Monday, July 7, 2025, that the BRICS group is not pursuing "confrontation" following Trump's tariff warning.
BRICS Nations Slam U.S. Tariffs, Sidestep Mention of Trump
2 jam lalu
BRICS leaders, meeting at a summit on Sunday, collectively condemned the "indiscriminate" tariffs imposed on imports by U.S. President Trump.
10 Highest-Paying Government Jobs in the U.S.
4 jam lalu
From law enforcement to IT and public policy, the highest-paying government jobs in the U.S. span a wide range of industries and responsibilities.
Trump to Start Talks with China on TikTok Deals This Week
6 jam lalu
President Donald Trump says he will begin negotiating with China about the TikTok deal this week.
U.S. to Send Tariff Letters to 100 Small Economies as 90-Day Deadline Looms
7 jam lalu
The United States (U.S.) will send letters to about 100 small economies regarding Trump's tariff policy.
A Look at Indonesia-US Trade Balance
7 jam lalu
From May 2020 to May 2025, Indonesia's trade balance with the United States remained in surplus.
Trump Threatens 10% Tariff Hike on BRICS Nations
7 jam lalu
President Donald Trump said that the U.S. would impose a 10 percent tariff on any country that aligns itself with the BRICS' anti-American policies.
US Import Tariffs Weaken IHSG
9 jam lalu
The Composite Stock Price Index (IHSG) weakened by 0.05 percent to 6,861.7 in today's first trading session, Monday, July 7, 2025.
Elon Musk Challenges the Two-Party System in the U.S.
12 jam lalu
Elon Musk expresses disappointment with Donald Trump, whom he had previously supported, and now he has an idea to create a new party.
China Records $73.8 Billion Import to Indonesia, Up 16.51 Percent in 2024
16 jam lalu
China remains the largest importing country last year with a value of US$ 73.8 billion.
