Indonesia Bolsters ASEAN Trade to Counter US Tariff

April 25, 2025 | 05:19 pm

TEMPO.CO, Jakarta - In a strategic move to shield its economy from global uncertainties, Indonesia will reinforce trade with its Southeast Asian neighbors, Coordinating Minister for Economic Affairs Airlangga Hartarto said. The push comes as US tariff policies threaten to dampen global trade volumes, forcing Indonesia to pivot toward regional markets to keep its economic engines running.

Speaking at a virtual press conference on April 25, Hartarto revealed that strengthening intra-ASEAN trade was a key agreement reached during recent talks with regional economic ministers. "This is our target because developing nations and regional blocs serve as a shock breaker in navigating the turbulence ahead," he said.

The urgency of the pivot is clear, Airlangga added, urging domestic businesses to step up, find new alternative markets, and sharpen their competitive edge to anticipate the projected slowdown. The International Monetary Fund (IMF) recently slashed its global growth forecast from 3.3 percent to 2.8 percent, citing U.S. tariffs as a major drag.  

Speaking at the same event, Finance Minister Sri Mulyani Indrawati underscored the ripple effects of the US' 10-percent import tariffs, which have already disrupted cross-border shipments. To counter this, the government is hunting for fresh export opportunities.

Sri revealed that her ministry has conducted an in-depth analysis to pinpoint commodities with a Revealed Comparative Advantage (RCA) above one—goods deemed highly competitive on the global stage.

"We will share these findings with Minister Hartarto to map out how we can encourage industries with strong comparative advantages, so that they can break into not just the US market but also untapped markets worldwide," she said, emphasizing the need for Indonesian exporters to stay ahead of the curve.

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