Trump Unveils New Tariffs, Indonesia and Most ASEAN Nations Get 19%

American President Donald Trump unveiled a new list of tariffs that slap a 19 percent tariff on US-bound Indonesian goods -- the same as many of its ASEAN neighbors like Malaysia and Thailand.

In an executive order signed Thursday local time, Trump announced he would keep Indonesia’s rate at 19% as previously agreed.

Malaysia got a 19% tariff at the very last minute, quite a drop from what Trump had previously threatened: 25%. The Philippines will face a 19% import tax. The same goes for Cambodia and Thailand. Trump had used his steep duties on the two warring countries to end their bloody fighting. Indonesia's Southeast Asian neighbors had agreed to a ceasefire in a Malaysia-brokered peace deal. Both countries were originally supposed to be subject to a 36% rate.

Vietnam -- Indonesia’s top competitor in apparel and footwear exports -- will get charged a 20% tariff. The document also set a 25% tax on Bruneian goods. Levies on Singapore will remain at 10%. Tariffs on Laos and Myanmar stay at 40% after the two countries failed to clinch a trade deal.

The new tariff regime will take effect on August 7.

According to a White House fact sheet on the latest trade move, the US clearly looked forward to the deal with Indonesia.

“Additional trade deals with Indonesia, the Philippines, South Korea, Vietnam, and others will protect our industries, open foreign markets, and encourage foreign investment in American industries,” the White House wrote.

The latest tariffs on Indonesia marked a 13 percentage point drop from what Trump had announced back in April. In exchange for a lower-than-promised levy, Jakarta has promised to make some major trade concessions, including eliminating the tariffs on virtually all US goods and making some major energy purchases worth USD 15 billion and USD 3.2 billion for American aircraft procurement. Jakarta has also agreed to buy American farm products totaling USD 4.5 billion in value.

The freshly released executive order meant two of the world’s largest palm oil suppliers, Indonesia and Malaysia, would get a 19% tariff. However, senior minister Airlangga Hartarto recently revealed that negotiations were still underway in hopes that Indonesian palm oil and cacao, among others, could get lower rates, or even close to 0 percent.

“The US will lower the 19% duty on goods that it cannot produce domestically, such as palm oil. But we are still negotiating the terms,” Airlangga said in Jakarta earlier this week.

Source: Jakarta Globe 

Indonesia Eyes Major CPO Export Role in Canada, Boosts Agri Ties

 Indonesia is aiming to become a major exporter of crude palm oil (CPO) to Canada while also strengthening strategic cooperation in the agricultural sector, including livestock development.

“We are pushing for Indonesia to become a major exporter of CPO to Canada. We are strengthening cooperation for mutual benefit,” said Agriculture Minister Andi Amran Sulaiman during a visit by Canadian Minister of Agriculture and Food Security, Heath MacDonald, on Thursday.

The visit reaffirmed Indonesia’s role as a respected strategic partner in Canada’s agricultural diplomacy within the Indo-Pacific region.

During their meeting, the two ministers discussed opportunities for cooperation amid global challenges such as climate uncertainty, geopolitical tensions, and food crises.

Sulaiman underscored the importance of a mutually beneficial partnership to enhance both national and global food security.

One key issue discussed was boosting Indonesia’s palm oil exports to Canada, where Indonesia is currently the second-largest supplier.

The ministers also explored collaboration opportunities in livestock development—particularly dairy and live cattle—as well as in the transfer of modern agricultural technology and climate-resilient practices.

Canada reiterated its commitment to enhancing trade relations with Indonesia, including through the recently concluded Comprehensive Economic Partnership Agreement (CEPA).

Minister MacDonald stated that the current geopolitical climate presents an opportunity to increase trade with Indonesia, deepen bilateral ties, and foster sustainability—especially in the agricultural sector.

In 2024, Indonesia’s agricultural commodity exports to Canada surpassed USD 222 million. The main exports included rubber (USD 115.4 million), cocoa (USD 58.2 million), coffee (USD 29.5 million), and pineapple (USD 5.8 million).

This latest meeting marked a significant milestone in building a robust agricultural partnership and aligns with Indonesia’s vision of developing a modern, sustainable, and inclusive agricultural sector.

Source: Antara News 

Indonesia's Exports Rise Again in June as U.S.-bound Shipments Jump

Indonesia's exports rose in June as exporters sought to beat the U.S. tariff deadline and shipments of palm oil and gold jewellery increased, while inflation accelerated in July, official data showed on Friday.

June shipments from Southeast Asia's biggest economy jumped 11.29% on a yearly basis to USD 23.44 billion, higher than the 10.41% forecast by economists polled by Reuters. Exports rose 9.68% in May.

Excluding oil and gas, June shipments to the U.S. rose 33.5% on a yearly basis. Top Indonesian products sold to U.S. buyers included electrical machinery, clothing, footwear, palm oil, rubber and seafood.

Shipments of palm oil from the world's biggest producer surged 15.1% in June, while gold and jewellery exports more than doubled from the same month in 2024.

Imports in June rose 4.28% on a yearly basis to USD19.33 billion, below the poll's forecast of 6.5%.

The result was a bigger-than-expected trade surplus of USD 4.11 billion in June, above the poll's expectation of USD 3.45 billion, but down slightly from May's USD 4.30 billion.

Indonesian exporters in recent months have brought forward shipments to the United States ahead of President Donald Trump's August 1 deadline for tariff negotiations.

Washington set Indonesia's import tariff at 19% under a deal agreed in July, from threatening a 32% levy earlier, after Jakarta agreed to eliminate most tariffs affecting U.S. industrial and agricultural products and to buy more American goods.

Trump has issued an executive order saying the new tariff rates will be implemented in seven days.

Indonesia's trade surplus may be squeezed as the tariffs take effect, with imports likely to rise and exports affected by lower prices of its top commodities, such as coal, Bank Danamon economist Hosianna Situmorang said.

Meanwhile, Indonesia's July annual inflation accelerated to 2.37% on an annual basis, more than the 2.25% expected by analysts, reflecting higher prices of foods such as shallots, rice, and tomatoes, as well as rising utility and education costs.

Annual core inflation, which strips out government-controlled and volatile food prices, was 2.32% in July, compared with an analyst estimate of 2.37%.

Both rates remained within the central bank's target range of 1.5% to 3.5%. Bank Indonesia has cut interest rates, four times since September, citing low inflation and a need to support economic growth.

Josua Pardede, an economist at Bank Permata, said despite the impact of the tariffs on Indonesia's external position, the current account deficit was likely to remain manageable.

"This underpins our call for up to 50 bps BI-rate cuts in 2025," Pardede said.

Source: Reuters