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A significant trade agreement has been sealed between the Trump administration and Indonesia, poised to dramatically reshape bilateral economic ties. This landmark deal will see US tariffs on Indonesian products slashed, while simultaneously unlocking Indonesia's market to American goods with a commitment for over $30 billion in purchases. The move signals a strategic deepening of economic cooperation.
The agreement came during a visit to Washington by Indonesia's President Prabowo Subianto to attend the first meeting of the Trump-led "Board of Peace" to discuss the reconstruction of Gaza.
Washington said it granted tariff exemptions on some Indonesian goods, including certain clothing and textiles that are produced with cotton and man-made materials from the US.
US trade representative Jamieson Greer said the agreement will "break down trade barriers" while advancing the interests of the American people.
Indonesia's coordinating minister for economic affairs Airlangga Hartarto said the finalised deal is beneficial to both sides and will attract greater investment in Indonesia.
Airlangga said about 90% of Indonesia's requests on tariff terms were accepted by the US.
"The vision of this agreement is mutual economic prosperity, strong supply chains, and respect for each country's sovereignty," he told reporters in Washington.
Airlangga said that as part of the deal, Indonesia has secured tariff exemptions for more than 1,700 goods, including coffee, spices, chocolate, natural rubber and, notably, its top export product palm oil.
It comes in exchange for Indonesia opening up its markets to American products, such as by accepting US standards on car safety, emissions, medical devices and pharmaceuticals, said the White House.
Indonesia will lift trade barriers on American imports including agriculture, healthcare, seafood, technology and car-related products. It has also committed to buy billions of dollars of US goods - including cotton, soy, beef, Boeing jets and energy.
Indonesia will facilitate US firms in developing the South East Asian country's rare earths infrastructure, which will help Washington expand its supply of critical minerals.
The deal will take effect in 90 days and changes could still be made to the terms if both countries agree, said Airlangga.
