US Products Free Of Import Duty To RI, Undip Economist: Domestic Industry Threatened With Collaps

JAKARTA Undip's Economic Expert, Wahyu Widodo, assessed that the policy of free duty to enter United States (US) products to Indonesia would make domestic industries threatened with collapse which resulted in layoffs.

He said agricultural products and tobacco products from the US could be serious competitors for domestic farmers and manufacturers.

What will be imported from there is agricultural products, oil, cigarettes. It will compete with the domestic industry, which is more dangerous. Because it could be that the domestic industry will be threatened with collapse," he said, Sunday, July 20, 2025.

Wahyu compared this situation to soybean cases in the 1990s. Indonesia is said to have been independent, but ultimately lost competition due to open global trade. Actually, Indonesia can't produce soybeans, we are still quite competitive. But as a consequence of open international trade, we both have to accept that," he added.

According to him, there are two major steps that must be taken immediately to anticipate the impact of US tariff policies.

First, entrepreneurs must penetrate the market into other areas such as Europe, the Middle East, or Africa.

However, this requires strong data and research support, not just an exhibition promotion.

The problem is that we are weak in the intelligence market. We must know the needs and behavior of consumers in each country. For example, if we sell small-size sachet drinks to Africa, it is not necessarily suitable because their bodies are also bigger," he said.

Second, the government must continue to negotiate and possibly renegotiate rates with the US in order to be more rational. Otherwise, Indonesia could lose most of its flagship export market.

"The government's best steps are to negotiate and renegotiate with various approaches, so that the tariff is harmonious, perhaps set for our products to America," Wahyu added.

Dia menyatakan, meski situasi terlihat mengkhawatirkan, peluang masih terbuka selama ada kesiapan dari pengusaha dan pemerintah.

Apalagi, lanjut Wahyu, kebijakan tarif Trump bisa berubah sewaktu-waktu, tergantung tekanan politik domestik AS dan dinamika global.

“Sekarang kita tinggal menunggu perkembangan terakhir, ini kan sifatnya dinamis. Nanti akan ada perubahan lagi. Jadi ya kita harus legowo menerima style-nya Presiden AS yang sekarang, dengan ketergantungan kita ke mereka,” tutup Wahyu.

He stated, although the situation looks worrying, opportunities are still open as long as there is readiness from entrepreneurs and the government.

Moreover, Wahyu continued, Trump's tariff policy could change at any time, depending on the pressure of domestic US politics and global dynamics.

"Now we are just waiting for the latest developments, this is dynamic. Later there will be more changes. So yes, we must be willing to accept the current style of the President of the US, with our dependence on them," Wahyu concluded.