August 6, 2025 | 10:13 pm
TEMPO.CO, Jakarta - The Ministry of Trade responds to the implementation of the United States' reciprocal tariff on Indonesia, which took effect on Thursday, August 7, 2025. According to Minister Budi Santoso, the 19 percent tariff set by the U.S. will bring benefits because countries that are Indonesia's trading competitors receive higher tariff rates.
Budi Santoso cited the reciprocal tariffs the U.S. imposes on China, Vietnam, and India, with rates exceeding 19 percent. According to Budi Santoso, these three countries are Indonesia's main competitors for exports to the U.S. If Indonesia receives lower tariffs than these countries, there is a high probability that Indonesian goods will have a competitive edge in the U.S. market.
"We are optimistic that if the American market continues to be vibrant, it means it will be easier for us to enter. We are one step ahead compared to other countries. We receive lower rates, so hopefully it will be easier to enter. This is a great opportunity," said Budi Santoso when met at the Ministry of Trade Auditorium on Wednesday, August 6, 2025.
Budi Santoso also compared the reciprocal tariff rates imposed by the U.S. on Indonesia with several other countries in Southeast Asia. According to him, Indonesia's current position is similar to Malaysia, Thailand, and the Philippines, which also receive a 19 percent tariff rate.
However, he is not concerned about the equal tariff rates for these three countries. Budi believes that Malaysia, Thailand, and the Philippines are not Indonesia's competitors for export to the U.S. "We encourage business players in Indonesia to take advantage of this opportunity," said Budi Santoso.
Coordinating Minister for the Economy Airlangga Hartarto stated that the 19 percent tariff imposed on Indonesia is one of the lowest in Southeast Asia, except for Singapore, which receives a 10 percent tariff. "Almost all ASEAN countries have nearly completed negotiations, and ASEAN countries, excluding Singapore, have the lowest tariff of 19 percent," he said.
According to Airlangga, Indonesia still has a significant opportunity to compete in the U.S. export market, especially compared to India, which is the main competitor in the textile and textile product (TPT) sector. India is subject to a 25 percent tariff by the U.S. "If the level of playing field is the same, it means only the improvement of competitiveness and some of our commodities, which the U.S. does not produce, are given lower tariffs," said Airlangga.
On the other hand, some Indonesian commodities also receive a zero percent tariff, such as copper concentrate and copper cathode. Airlangga mentioned that this aligns with the strategic discussions of the two countries on mineral trade.
"So, this is in line with the discussion on strategic minerals, including copper, which has been announced by the US. This is what Indonesia refers to as industrial commodities, the products of secondary processes after ore, in line with what has also been announced by the Minister of Trade from the White House," said Airlangga.
Annisaa Febiola contributed to the writing of this article
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