President Donald Trump and Indonesian President Prabowo Subianto finalized a trade agreement that’s expected to lower U.S. tariffs and see Jakarta facilitate the purchase of an estimated $33 billion in American goods. The agreement eliminates heightened duties on some of Indonesia’s exports and creates a mechanism for certain textiles and apparel to earn tariff exemptions, while Indonesia will eliminate levies on more than 99 percent of U.S. goods and remove non-tariff barriers.
Under the deal, Indonesia — a Group of 20 nation that counts the U.S. as its second-biggest export destination — will avoid the threatened 32 percent tariffs and instead face a 19 percent rate for most goods.
A tariff schedule published as part of the deal shows tariffs will be lifted on a range of commodities, from rice to fruits, potatoes, vegetables, fish and meat. Other ag and food products will be subject to tariff-rate quotas.
The Indonesian government is expected to facilitate $4.5 billion in agricultural purchases, including by importing at least the following annual volumes over the next five years:
- 163,000 metric tons of cotton (150,000 tons thereafter)
- 3.5 million tons of soybeans (2.5 million tons thereafter)
- 3.8 million tons of soybean meal (200,000 tons thereafter)
- 2 million metric tons of wheat (1.3 million tons thereafter)
Indonesia is also expected to meet minimum import volumes of the following commodities:
- 26,000 metric tons of apples
- 50,000 metric tons of beef
- 3,000 metric tons of citrus fruits
- 100,000 metric tons of corn
- 150,000 metric tons of corn gluten meal
- 1,000 metric tons of ethanol
- 5,000 metric tons of grapes
- 1,000 metric tons of rice
