AS'RI Trade Agreement, Indonesia Becomes A Consumer Not A Partner

Rupiah (photo: dock. Antara)

JAKARTA Economic observer from Andalas University, Syafruddin Karimi, believes that the US 'Indonesia 2025' reciprocal trade agreement, which is claimed to be based on reciprocal principles, actually shows fundamental inequality in the distribution of rights and obligations between the two countries.

Karimi said that in this agreement, Indonesia is required to abolish 99 percent of tariffs on products from the United States, eliminate various regulatory protections such as provisions for local content and import licenses, as well as open access to digital markets and cross-border data without getting equal returns.

"Meanwhile, the US only lowers tariffs by 19 percent and maintains its domestic protection space," he said in his statement, Thursday, July 24.

Furthermore, he said that Indonesia's commitment to reforming labor and environmental regulations was not accompanied by similar obligations from the US side, so this made the reform more a disciplinary instrument rather than a shared responsibility.

According to him, in this context, there is no structural correction mechanism in this agreement that can balance the burden of liberalization with the protection of national interests, both for the MSME sector, farmers, and domestic strategic industries.

In addition, he added that commercial transactions worth billions of dollars, such as the purchase of aircraft, energy, and agricultural products from the US, placed Indonesia more as a consumer than partners on par in the global value chain.

"Therefore, even though it is packaged in a narrative of reciprocity, this agreement substantively reflects the dominance of the central economy over the outskirts, and if it is not critically reviewed, it will only deepen Indonesia's structural dependence in a global trading system that is unequal," he stressed.