Sri Mulyani Calls Trump's Import Tariff Policy Not Based On Economic Science Principles

Minister of Finance Sri Mulyani. (Photo: Aris Nurjani/VOI)

JAKARTA - Finance Minister Sri Mulyani Indrawati revealed that the calculation of the reciprocal tariff applied by United States President Donald Trump to a number of countries is difficult to understand.

For information, Trump set a reciprocal rate of 32 percent for Indonesia, 46 percent for Vietnam, 24 percent for Malaysia, 26 percent for India, 24 percent for Japan, and 17 percent for South Korea.

"The reciprocal tariff submitted by America to 60 countries (not) describes how to calculate these rates, which I think all economists who have studied the economy cannot understand," he said in an economic agreement with the President of the Republic of Indonesia, strengthening Indonesia's economic resilience amid a wave of trade tariff wars, Tuesday, April 8.

According to him, the tariff policy is not based on economic principles, because the main goal is to overcome the trade deficit with partner countries.

Thus, Trump is more focused on reducing imports from partner countries and increasing exports to these countries.

"So, this also no longer applies to economic science, the important thing is the first tariff because the goal is to close the deficit. There is no economic knowledge there. Closing the deficit, that means I don't want to depend or buy to other people more than what I can sell to others," he said.

"It's purely transactional. There is no basis for economic science. So these friends have the Indonesian Economic Bachelors Association (ISEI) here, sorry it's useless, sir, the science today," he added.

Sri Mulyani assessed that this reciprocal tariff policy has created extraordinary uncertainty at the global level, especially between February and April.

Within just two months, Trump's policy has changed the global economic map.

"This timeline describes a world that was previously governed with a rule based, now there is no certainty. This is something we need to pay attention to in our management of the economy," he added.