US President Donald Trump announced a trade deal with Indonesia on Tuesday, the latest in a series of efforts to improve terms with trading partners and reduce the US’s huge trade deficit.
“A great deal, for everyone, has just been agreed upon with Indonesia. I have spoken directly with their esteemed President. Details are coming!” Trump wrote in a post on his social media account.
Indonesia’s total trade with the US in 2024 was about $40 billion. While not even in the top 15, it is growing. US exports to Indonesia grew by 3.7 percent last year, while imports increased by 4.8 percent, leaving the US with a trade deficit of nearly $18 billion.
The main imports from Indonesia last year, according to the US Census Bureau, were palm oil, electronic equipment including data routers and switches, footwear, car tires, natural rubber and frozen shrimp.
A senior official at Indonesia’s economic affairs ministry told Reuters: “We are preparing a joint statement from the United States and Indonesia that will explain the size of the reciprocal tariffs for Indonesia, including the tariff agreement and the commercial arrangements. We will inform the public soon.”
In a letter to the president, Trump threatened the Southeast Asian country with a 32 percent tariff that would take effect on August 1. Trump has sent similar letters to about two dozen trading partners this month, including Canada, Japan and Brazil, setting single tariffs of 20 to 50 percent, as well as 50 percent on copper.
The August 1 deadline gives the countries time to negotiate agreements that could reduce the tariffs.
