KSP Says Indonesia Anticipated US Reciprocal Tariffs in Advance

TEMPO.CO, Jakarta - The Presidential Staff Office (KSP) stated that the government anticipated early on the United States' reciprocal tariff policy towards Indonesia at 32 percent from a base tariff of 10 percent applied to all countries.

"Basically, we have anticipated and mitigated early on, because President Donald Trump's policy is not something that happened suddenly within a few days," said the Acting Deputy II of KSP Edy Priyono during a Coordination Meeting to Maintain Supply and Food Prices Stability Post-Idul Fitri 1446 Hijriah held by Bapanas virtually in Jakarta, Thursday, April 3, 2025, as quoted by Antara.

Edy conveyed this when the media asked for a response to U.S. President Donald Trump's policy of imposing new basic tariffs and import duties on many trading partners, including Indonesia, which is subject to a reciprocal tariff of 32 percent.

"Previously, we already knew the direction it was heading. What we did find out was the tariff; our reciprocal is 64 percent after a half discount of 32 percent," he said.

However, Edy mentioned that he could not confirm whether there was a specific directive from President Prabowo Subianto regarding the reciprocal tariff policy set by Trump, because his position was not the right person to convey such information.

Nevertheless, he admitted that the Presidential Chief of Staff A.M. Putranto had given instructions to analyze the impact of Trump's policy on Indonesia.

"We cannot confirm whether or not there is a specific directive from Bapak President. Because at our level in the Office of Leadership, we can only confirm that there is a directive from the president's chief of staff, and then analyze its impact," he said.

He admitted that they had already analyzed the impact of the policy. "We have done it. Of course, we cannot provide the details here," he said.

Furthermore, Edy said that the tariff will be imposed on products from different countries, not just Indonesia, so theoretically, demand from America will decrease.

Although these tariffs vary from country to country, they are not expected to affect Indonesia's relative competitiveness with other countries, so their negative impact can be minimized.

"Although we acknowledge that America is the second export destination for Indonesia," Edy said.

According to him, the depreciation of the rupiah exchange rate against the US dollar will benefit the export performance, although it will burden importers.

"From the export side, it is actually an opportunity. So our products are actually down slightly in US dollar terms. However, the depreciation of the rupiah will make imported goods expensive. But it will make export products cheaper. So, there is a little opportunity here," he explained.

He reiterated that mitigation and anticipation efforts had been carried out early on, with the hope that the policy would not have a significant impact on Indonesia.

"We certainly try to do our best, including the possibility of lobbying and so on, it's something reasonable," said Edy.

On Wednesday, April 2, 2025, President Trump announced increasing trade tariffs to countries that have a trade surplus with the United States.

Based on White House data, Indonesia is ranked eighth in the list of countries affected by the increase in U.S tariffs, at a rate of 32 percent. About 60 countries will be subject to half-reciprocal tariffs compared to the tariffs they impose on the U.S.

Indonesia is not the only country in Southeast Asia targeted by the U.S. trade policy. Malaysia, Cambodia, Vietnam, and Thailand also saw tariff increases of 24 percent, 49 percent, 46 percent, and 36 percent, respectively.

Trump's long-sought-after tariffs were announced at the "Make America Wealthy Again" event in the Rose Garden at the White House on Wednesday local time.

Trump's universal era tariffs are reported to take effect on Saturday (5/4/2025), while reciprocal tariffs, which target around 60 U.S. trading partners, will be implemented starting Wednesday, March 9, 2025.

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