Indonesia’s trade deal with US ‘still on’

JAKARTA, Indonesia (MNTV) – Trade negotiations between Indonesia and the U.S. remain ongoing, the government insists, seeking to dispel reported U.S. concerns over the implementation of a deal agreed in July.

“There are no specific issues with the discussions, and normal dynamics are part of the process,” a spokesman for the Office of the Coordinating Economy Minister, Haryo Limanseto, told The Jakarta Post.

The statement came after several media reports, citing growing frustration in Washington, suggested talks on a bilateral trade agreement were in danger of collapsing.

The deal with Indonesia could be at risk, because Jakarta reportedly backtracked on several commitments, “reneging” on what the two countries had agreed. 

U.S. officials said Indonesia was “backsliding” on agreements to eliminate non-tariff barriers on American industrial and agricultural exports as well as on digital trade issues.  

The two sides are also clashing over an effort by the US to include clauses Indonesia sees as infringing on its economic sovereignty.

In July, the two countries said Indonesia had agreed to eliminate import tariffs on 99 percent of U.S. goods under “a joint statement” on a “framework” for a trade agreement, alongside plans to buy some $19 billion worth of U.S. products.

In return, the US slashed its so-called “reciprocal” tariff on Indonesian goods from 32pc to 19pc, with possible further cuts for select commodities “not naturally available or domestically produced in the United States”.

In the negotiations with Washington, Jakarta has sought to secure tariffs of zero percent on key commodities including palm oil, coffee and downstream mineral products, with Coordinating Economy Minister Airlangga Hartarto saying the government hoped to seal a final agreement this year. 

Airlangga is expected to meet USTR head Jamieson Greer this week.