TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search resultsLimited gains, steep hurdles overshadow US-RI trade deal, analysts say
Local think tanks are weighing in on the limited policy space and domestic benefits of the new US-Indonesia trade deal, even as businesses and policymakers wait to decide next moves amid the limbo left by the US Supreme Court's ruling.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
President Prabowo Subianto (left) and United States President Donald Trump speak on Feb. 19, 2026, during the signing ceremony for the US-Indonesia Agreement on Reciprocal Tariffs (ART) in Washington, D.C. (Courtesy of Presidential Secretariat/White House)
T
he United States-Indonesia Agreement on Reciprocal Trade (ART) is likely to yield limited economic gains and face significant implementation hurdles, local think tanks say, after assessing the newly signed deal’s costs and benefits.
To secure the 19 percent US tariff rate under the agreement, which is yet to be ratified by lawmakers in the two countries, Indonesia will relinquish several long-standing national policies. These include the policy on local content levels (TKDN), an export ban for critical minerals and strict rules on halal certification, as well as its commitment to not imposing a digital services tax.
Given that the ART mandates ratification within 90 days, experts say Jakarta is compelled to enact regulatory changes that would be politically challenging and could leave affected industries with little room for compensation.
“This agreement is not about tariffs or market access. It is about defending US commercial interests and projecting security alignment and values,” Riandy Laksono, an economic researcher at the Centre for Strategic and International Studies (CSIS), Indonesia, told a media briefing on Friday.
Read also: RI exporters worry about US demand as new tariff kicks in
The government has said the trade deal would secure lower tariffs and broader access to the US market for Indonesian goods, but CSIS research suggests the gains will be modest and that the case for broader market access is overstated.
The deal grants Indonesia zero-tariff treatment for 1,819 products, but these goods account for only 24 percent of all US-bound exports, according to CSIS. Meanwhile the US, which contributes just 10 percent of Indonesian exports, is not the primary market for most of those products.
