President Donald Trump on Tuesday said the US would impose a 19 percent tariff on goods from Indonesia under a new agreement with the Southeast Asian country and more deals were in the works as he continued to press for what he views as better terms with trading partners and ways to shrink a huge US trade deficit.<\/p>\n
The pact with the relatively minor US trading partner is among the handful struck so far by the Trump administration ahead of an Aug. 1 deadline for tariffs on most US imports to rise again. The accord came as the top US trading partner \u2014 the European Union \u2014 readied retaliatory measures should talks with Washington fail.<\/p>\n
As that deadline approached, negotiations were under way with other nations eager to avoid more US levies beyond a baseline 10 percent on most goods that has been in place since April.<\/p>\n
Trump\u2019s roll-out of the policies has often been chaotic. His moves have upended decades of negotiated reductions in global trade barriers and roiled international financial markets and economic activity along the way.<\/p>\n
Based on Trump tariff announcements through Sunday, Yale Budget Lab estimated the US effective average tariff rates will rise to 20.6 percent from between 2 percent and 3 percent before Trump\u2019s return to the White House in January. Consumption shifts would bring the rate down to 19.7 percent, but it\u2019s still the highest since 1933.<\/p>\n
Trump outlined an Indonesia deal similar to a pact struck recently with Vietnam, with a flat tariff on exports to the US roughly double the current 10 percent and no levies on US exports going there. It also included a penalty rate for so-called transhipments of goods from China via Indonesia and a commitment to buy some US goods.<\/p>\n
\u201cThey are going to pay 19 percent and we are going to pay nothing … we will have full access into Indonesia, and we have a couple of those deals that are going to be announced,\u201d Trump said outside the Oval Office. Trump later announced on his Truth Social platform that Indonesia had agreed to buy $15 billion of US energy products, $4.5 billion of American farm products and 50 Boeing jets, though no time frame was specified.<\/p>\n
Indonesia\u2019s total trade with the US \u2014 totaling just under $40 billion in 2024 \u2014 does not rank in the top 15, but it has been growing. US exports to Indonesia rose 3.7 percent last year, while imports from there were up 4.8 percent, leaving the US with a goods trade deficit of nearly $18 billion.<\/p>\n
The top US import categories from Indonesia, according to US Census Bureau data from the International Trade Centre\u2019s TradeMap tool, last year were palm oil, electronics equipment including data routers and switches, footwear, car tires, natural rubber and frozen shrimp.<\/p>\n
Susiwijono Moegiarso, a senior official with Indonesia\u2019s Coordinating Ministry for Economic Affairs, told Reuters in a text message: \u201cWe are preparing a joint statement between US and Indonesia that will explain the size of reciprocal tariff for Indonesia including the tariff deal, non-tariff and commercial arrangements. We will inform (the public) soon.\u201d<\/p>\n
Trump had threatened the country with a 32 percent tariff rate starting August 1 in a letter sent to its president last week. He sent similar letters to about two dozen trading partners this month, including Canada, Japan and Brazil, laying out tariff rates ranging from 20 percent to 50 percent, plus a 50 percent tariff on copper.<\/p>\n
Speaking in Pittsburgh on Tuesday, Trump said he favored blanket tariffs over complicated negotiations, but his Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick were keen to land more trade agreements.<\/p>\n
Upon his arrival back in Washington, Trump told reporters that letters would be going out soon for many smaller countries, suggesting they would face a tariff of \u201ca little over 10 percent.\u201d<\/p>\n
The Aug. 1 deadline gives targeted countries time to negotiate about lower tariff rates. Some economists have also noted Trump\u2019s pattern of backing off his tariff threats.<\/p>\n
Since launching his tariff policy, Trump has clinched only a few deals, falling short of earlier promises to land \u201c90 deals in 90 days.\u201d<\/p>\n
So far, framework agreements have been reached with the United Kingdom and Vietnam, and an interim deal has been struck with China to forestall the steepest of Trump\u2019s tariffs while negotiations continue between Washington and Beijing.<\/p>\n
Trump said talks with India were moving \u201calong that same line,\u201d adding, \u201cWe\u2019re going to have access to India. And you have to understand, we had no access into any of these countries. Our people couldn\u2019t go in. And now we\u2019re getting access because of what we\u2019re doing with the tariffs.\u201d<\/p>\n
The breakthrough with Indonesia came as the European Commission, which oversees trade for the EU, prepared to target 72 billion euros ($84.1 billion) worth of US goods \u2014 from Boeing aircraft and bourbon whiskey to cars \u2014 for possible tariffs if trade talks with Washington fail.<\/p>\n
Trump is threatening a 30 percent tariff on imports from the EU from August 1, a level European officials say is unacceptable and would end normal trade between two of the world\u2019s largest markets.<\/p>\n
The list, sent to EU member states and seen by Reuters Tuesday, pre-dated Trump\u2019s move over the weekend to ramp up pressure on the 27-nation bloc and responded instead to US duties on cars and car parts and a 10 percent baseline tariff.<\/p>\n
The package also covers chemicals, medical devices, electrical and precision equipment as well as agriculture and food products \u2014 a range of fruits and vegetables, along with wine, beer and spirits \u2014 valued at 6.35 billion euros.<\/p>\n
– Agencies<\/p>\n","protected":false},"excerpt":{"rendered":"
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