A trade agreement reached between the United States and Indonesia in July faces uncertainty after a U.S. official said Jakarta had stepped back from several commitments made during negotiations. The official, who spoke on condition of anonymity, said Indonesia was “reneging on what we agreed to in July,” without specifying which commitments were under dispute. Indonesian officials said talks were ongoing and that no specific problems had emerged during recent discussions. 

Haryo Limanseto, spokesperson for Indonesia’s Coordinating Ministry for Economic Affairs, said the “dynamics in the negotiation process are normal,” adding that the government hoped to conclude an agreement beneficial to both countries.  

In July, the two sides announced that Indonesia had agreed to eliminate tariffs on more than 99% of U.S. goods and remove non-tariff barriers, while the United States would lower threatened tariffs on Indonesian products to 19% from 32%. 

The Financial Times reported that U.S. negotiators believed Indonesia was backtracking on commitments related to non-tariff barriers and digital trade measures. U.S. Treasury Secretary Scott Bessent said at a recent event in New York that Indonesia “was getting a little recalcitrant” regarding the agreement, without offering further detail. 

Indonesia’s Coordinating Ministry for Economic Affairs issued a statement reiterating that the bilateral trade negotiations were continuing without obstacles that could lead to a breakdown. The ministry noted that the United States had agreed in July to reduce high reciprocal tariffs on Indonesian goods from 32% to 19%, with the possibility of further reductions.  

The Ministry of Trade also addressed public concerns about reports of a possible breakdown in the talks. Trade Minister Budi Santoso said the negotiation process was continuing. “No, everything is still in negotiation,” he said when asked by CNBC Indonesia about the reported strain in the discussions. 

The minister added that communication with Washington was ongoing, including plans for a U.S. delegation to visit Indonesia. “That is part of the negotiation process,” he said.