President Trump Announces Trade Agreement, Indonesia Is Called The Open Market For US Products

JAKARTA - President Donald Trump announced a trade agreement with Indonesia in a post on his social media, citing cutting tariffs and tariff barriers so that it will become an open market for United States products.

He conveyed this in an upload on his Truth Social account on Wednesday.

"It is agreed that Indonesia will become an Open Market for Products of Industry and Technology America, and Agricultural Goods, by eliminating 99% of their Tariff Obstacles. The United States will now sell American Made Products to Indonesia with a NOL Tariff, while Indonesia will pay 19% for all their products that enter the US Best Market in the World!" wrote President Trump as quoted Wednesday, July 23.

"In addition, Indonesia will supply the United States with their valuable Critical Minerals, as well as sign a large deal, worth tens of billions of dollars, to buy Boeing Aircraft, American Agricultural Products, and American Energy. This deal is a major VICTORy for Car Manufacturers, Technology Companies, Workers, Farmers, Breeders, and our Producers. Thank you for your attention to this. SCHEDULE AMERICA IS GREAT AGAIN!" he said.

Meanwhile, details of the agreement's framework were released in a joint statement by the two countries, and a fact sheet issued by the White House, quoted by Reuters.

They said negotiators from the two countries would finalize the actual agreement in the coming weeks.

"Today, the United States and the Republic of Indonesia have agreed on a framework to negotiate a reciprocal trade agreement to strengthen our bilateral economic relations, which will provide unprecedented access for exporters of the two countries to their respective markets," the statement said.

Under the agreement, Indonesia will soon cancel its plans to impose tariffs on internet data streams and agree to support the renewal of the e-commerce import duty moratorium from the long-standing World Trade Organization, a senior President Trump administration official told reporters via conference call.

Indonesia will also remove pre-delivery inspections and verification recently imposed on US exports that have caused problems for US agricultural exports, contributing to an increasing US agricultural trade deficit, the official said.

The official, who is not authorized to speak in public, said the agreement could help restore the surplus of agricultural goods the United States once owned with Indonesia, to implement pre-delivery requirements.

As a victory for US automakers, the official said Indonesia had agreed to accept US Federal Motor Vehicle Safety Standards for vehicles exported from the United States to the developing country of 280 million people.

Indonesia has also agreed to remove restrictions on exports of industrial commodities, including essential minerals, the joint statement said. The US official said it would also remove local content requirements for products using these commodities sent to the United States.

The joint statement said the US would reduce reciprocal rates to 19 percent, and "may also identify certain commodities that are not naturally available or produced domestically in the United States for further reciprocal rate reduction."

No further details were given.

The two countries have stated that they will negotiate regulations on the origin of goods to ensure the benefits of the agreement are mainly felt by the US and Indonesia, not third countries.

They stated that Indonesia would try to overcome obstacles to US goods, including through the abolition of import restrictions and licensing requirements for US remanufacturing goods or spare parts.

Indonesia also agreed to join the Global Forum on Excess Steel Capacity and take action to overcome the global overcapacity in the steel sector.

Previously, Coordinating Minister for Economic Affairs Airlangga Hartarto at a press conference on Monday said the 19 percent trade rate for Indonesia would be carried out after a joint statement between the two countries.

Airlangga said the current tariff is the basic tariff (baseline tariff) of 10 percent.

"Indonesia is a country that has dealt with the United States. So it means that several countries that have, it is no longer valid on August 1. So of course the August 1 is those who were sent letters yesterday. So for countries such as England, Vietnam, China, and Indonesia, there will be no more August 1. Now this will be determined and then wait for the joint statement and further announcement," explained Airlangga.

It is known, the tariff for Indonesia is the same as for the Philippines which was announced last Tuesday. Meanwhile, the tariff for Vietnam is 20 percent.