President Donald Trump announced a significant trade agreement with Indonesia on Tuesday, following discussions with its President, Prabowo Subianto. In a message shared via Truth Social, Trump declared that Indonesia would eliminate tariffs on American exports, while the United States would apply a 19% tariff on Indonesian imports.
Trump later elaborated to reporters that the terms of the arrangement were “finalized”; however, the Indonesian government had yet to confirm the agreement as of Tuesday afternoon. In his announcement, Trump revealed that Indonesia has agreed to procure $15 billion in U.S. energy, $4.5 billion in American agricultural goods, and 50 Boeing aircraft, including numerous 777 models.
The U.S. President highlighted that any transshipment through the country will face higher tariffs, a similar threat he made with Vietnam.
Trump noted Indonesia’s reputation for high-quality copper, hinting that Indonesian copper might face reduced tariffs. This could be a strategic move as Trump considers implementing a 50% tariff on all copper imports starting August 1. Although Indonesia exported $20 million of copper to the U.S. last year—significantly less than Chile and Canada, who exported $6 billion and $4 billion, respectively—this deal could still impact U.S. copper tariffs.
Additionally, Trump mentioned that India is similarly working towards securing a trade agreement. Previously, a 32% tariff on Indian goods was briefly enforced in April before transitioning to “reciprocal” tariffs of at least 10% for the past three months, set to expire on August 1.
