Indonesia Rejects Retaliation Against Trump Tariffs, Pursues Diplomatic and Market Stabilization Strategies
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JAKARTA, Investortrust.id — Indonesia has confirmed it will not retaliate against the United States’ new reciprocal tariff policy, choosing instead to pursue diplomatic negotiations, market stabilization efforts, and acceleration of international partnerships. The move comes as the US prepares to implement the policy on Tuesday, April 9, 2025, potentially impacting labor-intensive Indonesian export sectors such as footwear and apparel.
In a virtual high-level coordination meeting on Sunday, Coordinating Minister for Economic Affairs Airlangga Hartarto stated that the government has been in active dialogue with the Office of the United States Trade Representative, the U.S. Chamber of Commerce, and other partner countries. The aim is to devise a strategic response that aligns with national interests while preserving long-term bilateral trade relations and economic stability.
“We’ve been given a very short window—until April 9—to respond. Indonesia is preparing an action plan that takes into account American imports and investments,” said Airlangga.
Rather than retaliate, Indonesia's government is focusing on diplomacy and maintaining a conducive investment climate. This approach includes preparing a formal letter to the US before the deadline and conducting continuous policy evaluations within a deregulation framework following last month’s cabinet session.
The reciprocal tariffs announced by the US exclude specific categories such as humanitarian and medical goods, certain products already under Section 232 tariffs—like steel, aluminum, and automobiles—and strategic imports like copper, semiconductors, wood products, pharmaceuticals, bullion, and critical energy and minerals not readily available domestically.
As part of its domestic response, the Indonesian government has intensified consultations with industry associations, particularly those representing export-oriented and labor-intensive sectors. A feedback forum with industry stakeholders is scheduled for Monday, April 7, to ensure their concerns are reflected in policy discussions.
“All relevant industries will be invited tomorrow to provide input, especially regarding exports and issues critical to labor-intensive sectors,” said Airlangga.
Senior officials attending the coordination meeting included Governor of Bank Indonesia Perry Warjiyo, Finance Minister Sri Mulyani, Minister of Investment and Head of the Investment Coordinating Board Rosan Perkasa Roeslani, Trade Minister Budi Santoso, and Chairman of the Financial Services Authority Mahendra Siregar.
The government is also preparing to strengthen access to alternative markets, notably in Europe—currently Indonesia’s second-largest export destination after China and the US. By diversifying market access, policymakers hope to cushion the impact of any volatility resulting from the US tariff decision.
“We can push this as well, giving us access to broader markets,” Airlangga concluded.