Trump Imposes 19% Tariff on Indonesian Imports Amid Push for New Trade Terms
The U.S. will impose a 19% tariff on imports from Indonesia under a new trade deal, while gaining full access to the Indonesian market for American goods.
Trump announces 19% tariff on Indonesian goods as part of broader U.S. trade overhaul. Photo: @News5PH
July 16, 2025 Hour: 5:58 am
The United States will impose a 19% tariff on imports from Indonesia under a new trade agreement, President Donald Trump announced Tuesday, as part of a broader effort to reshape trade relationships and address the U.S. trade deficit.
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President Donald Trump on Tuesday announced a trade agreement with Indonesia that includes a 19% flat tariff on Indonesian exports to the United States, while granting full tariff-free access for U.S. goods entering Indonesia. The deal, which follows a similar agreement with Vietnam, is one of several being pursued ahead of a planned increase in U.S. import tariffs on August 1.
“They are going to pay 19% and we are going to pay nothing … we will have full access into Indonesia, and we have a couple of those deals that are going to be announced,” Trump stated outside the Oval Office.
The agreement also includes penalties for the transshipment of goods originating in China through Indonesia, and a commitment from the Indonesian government to purchase significant volumes of U.S. products. According to Trump, the deal involves \$15 billion in U.S. energy exports, \$4.5 billion in agricultural goods, and the sale of 50 Boeing aircraft. No specific delivery timeline was provided.
Indonesia is not among the United States’ top 15 trading partners, but bilateral trade has grown steadily. In 2024, total trade between the two countries reached nearly \$40 billion. U.S. exports to Indonesia rose by 3.7% last year, while imports from Indonesia increased by 4.8%, resulting in a U.S. goods trade deficit of almost \$18 billion.
Top U.S. imports from Indonesia include palm oil, electronics such as routers and switches, footwear, automotive tires, natural rubber, and frozen shrimp, according to data from the U.S. Census Bureau and the International Trade Centre.
Susiwijono Moegiarso, a senior official with Indonesia’s Coordinating Ministry for Economic Affairs, told Reuters in a text message: “We are preparing a joint statement between U.S. and Indonesia that will explain the size of reciprocal tariff for Indonesia including the tariff deal, non-tariff and commercial arrangements. We will inform (the public) soon.”
The new tariffs come as the Trump administration prepares to increase levies on a broad range of imports. Trump had previously threatened Indonesia with a 32% tariff in a letter sent to President Joko Widodo last week. Similar letters have been sent to around two dozen other countries, including Canada, Japan, and Brazil, outlining proposed tariff rates ranging from 20% to 50%, along with a 50% tariff on copper.
Based on Trump’s tariff announcements through Sunday, the Yale Budget Lab estimates that the effective average U.S. tariff rate will rise to 20.6%, up from between 2% and 3% prior to his return to office in January. Adjusted for projected changes in consumption, the rate would still stand at 19.7%—the highest since 1933.
As the United States accelerates its protectionist trade agenda, countries across the Global South face rising uncertainty in global markets, balancing domestic economic needs with growing external pressures driven by shifts in U.S. policy.
Author: MK
Source: Reuters