Indef Economist Calls European Union Potential Market Similar To US

JAKARTA - Executive Director of the Institute for Development of Economics and Finance (Indef) Esther Sri Astuti said the European Union is a potential market that is quite large for Indonesia if it wants to shift trade from the United States after the import rate policy of 19 percent.

Esther said Indonesia's exports to the European Union in 2024 reached 17.35 billion US dollars.

In addition, Indonesia's export commodities to the region include vegetable/animal oils, chemical industry products, machinery and equipment, footwear/topies, and mineral products.

"These are actually relatively similar products that we send to the US (United of State/United States) market. So if for example the US market is for us to do Trump rates, then we can do shifting from the US market to the European Union market very likely," Esther said in the Public Discussion "Diversary of America Down, Indonesia Will Down?" monitored online in Jakarta, Monday.

In facing the tariff set by President Donald Trump, Esther said, Indonesia must expand its trade or market diversification, thereby reducing dependence on only one market.

In addition, Indonesia also needs to cooperate economically with various countries, as well as create a conducive investment climate and have various types of export products.

According to him, product diversification can help deal with the turmoil situation due to the increase in tariffs from the United States.

"This strategy has also been carried out by Vietnam, that's why Vietnam in the first trade war of 2019 became a winner, yes, to be the country that benefited the most from the trade war at that time," Esther said.

He said the United States was the second largest trading partner country after China, which was the export destination.

However, for imports, it is in third place after China and Japan.

Esther assessed that product imports from the United States were not as big as China. According to Esther, many Chinese products are circulating in Indonesia compared to America.

Hal tersebut membuktikan bahwa Indonesia masih ketergantungan dengan satu negara saja.

Karena itu, Esther merekomendasikan agar pemerintah terus melakukan diversifikasi pasar.

"Sebanyak mungkin kita harus memberikan, menciptakan diversifikasi pasar ekspor, sehingga jika ada sesuatu atau gonjang-ganjing di satu negara, maka di negara yang lain juga kita bisa lakukan ekspor," imbuhnya.

This proves that Indonesia is still dependent on only one country.

Therefore, Esther recommends that the government continue to diversify its market.

"As much as possible we must provide, create diversification of the export market, so that if there is something or turmoil in one country, then in other countries we can also export," he added.