US and Indonesia reach tariff deal

July 16, 2025

President Donald Trump has reached a tariff agreement with Indonesia, reducing import duties from 32% to 19% following negotiations with Indonesian President Prabowo Subianto. In exchange, Trump claimed the U.S. would receive "full access" to Indonesian markets, with Indonesia agreeing to purchase $15 billion in U.S. energy, $4. 5 billion in agricultural products, and 50 Boeing jets.

Who is affected

Indonesian exporters to the U.S. (facing 19% tariffs instead of the threatened 32%)
U.S. firms seeking access to Indonesian markets
Indonesian consumers of U.S. energy and agricultural products
Boeing (with potential sale of 50 aircraft)
Workers in both countries involved in trade-related industries
American agricultural producers and energy companies

What action is being taken

The U.S. is reducing planned tariffs on Indonesian goods from 32% to 19%
Indonesia is reportedly providing greater market access for American firms
Indonesia is agreeing to purchase $15 billion in U.S. energy, $4.5 billion in agricultural products, and 50 Boeing jets
The Trump administration is negotiating tariff agreements with multiple countries following threats of high duties

Why it matters

Indonesia ranks among America's top 25 trade partners, sending approximately $28 billion in goods to the U.S. last year
The agreement affects major Indonesian export categories including clothing, footwear, and palm oil
According to economics professor Stephen Marks, the benefits to Indonesia "are more political than economic"
This deal represents part of a broader pattern of trade negotiations following Trump's tariff threats to multiple countries
The agreement impacts bilateral relations between the two countries during a period of increased trade tensions

What's next

No explicit next steps stated in the article

Read full article from source: BBC