The White House announced Thursday the conclusion of a "reciprocal" trade agreement with Indonesia, while President Prabowo Subianto was in Washington to participate in the first meeting of the "Board of Peace" launched by Donald Trump.
Under the terms of the agreement, Southeast Asia's largest economy will eliminate tariffs on 99% of U.S. goods. In return, the United States will maintain tariffs of 19% on most Indonesian goods, a rate similar to that applied to Cambodia and Malaysia. Jakarta has also committed to reducing non-tariff barriers and lifting certain restrictions on exports of critical minerals and other industrial raw materials to the United States.
Furthermore, Indonesian and American companies concluded eleven trade agreements this week with a total value of $38,4 billion. These agreements cover, among other things, the purchase of American soybeans, corn, cotton, and wheat, as well as cooperation in critical minerals, oil field recovery, and joint ventures in semiconductors.
The White House hailed the agreement as "excellent," likely to strengthen economic security and growth for both countries. The text was signed by U.S. Trade Representative Jamieson Greer and his Indonesian counterpart, Airlangga Hartarto, who spoke of the beginning of a "new golden age" in bilateral economic relations.
The announcement came on the same day that Prabowo Subianto, leader of the world's most populous Muslim-majority country, reiterated his commitment to sending 8,000 troops, or more if necessary, as part of an international stabilization force in Gaza. Indonesia is among the first countries to have made concrete commitments to the post-conflict reconstruction plan supported by Donald Trump.
The trade talks are also taking place within a strategic context marked by competition between Washington and Beijing. The United States is particularly seeking to secure access to critical minerals in order to reduce its dependence on China in sectors ranging from aerospace to digital technologies. Prabowo stated that Indonesia could serve as a "bridge" and an "honest mediator" between the major powers, while Jakarta maintains that it pursues an independent and balanced foreign policy.
