Indonesian ministers to visit Washington D.C.

A group of Indonesian international trade ministers will visit Washington today to discuss a limited bilateral trade deal between Indonesia

Indonesia US trade

Photo: Indonesian Ministry of Foreign Affairs/ AP

A group of Indonesian international trade ministers will visit Washington today to discuss a limited bilateral trade deal between Indonesia and the US.

Indonesian exports to the US totalled $20.1 billion in 2019. Since 1980, 13% ($2.1 billion in 2019) of those exports have been covered by a special reduced tariff privilege to promote its US exports. A bilateral free trade agreement could see trade value between the two countries expand to $60 billion within five years. Today’s trade talks follow a recent bilateral free trade deal signed between Indonesia and Australia.

In light of the US-China trade war, Washington is currently reviewing its global system of reduced tariff privileges. After Secretary of State Mike Pompeo’s October 29 trip to Jakarta, Washington announced that Indonesian exports would have the only tariff exemptions in Asia not reviewed for expansion, giving Jakarta hope for today’s talks.

A free trade deal with the US would give Indonesian firms bargaining power to attract manufacturers looking to move their production operations from China to circumvent tariffs. Jakarta is seeking to expand global trade relations to act as a buffer to Beijing’s local political, military, and economic aggression by diluting its dominance over Asian manufacturing and exports.

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