Indonesia’s Finance Minister, Sri Mulyani, has warned about the possibility of higher import duties on Indonesian products by the United States (US). This comes in the wake of similar measures being imposed on other countries.
Sri Mulyani raised these concerns during a press briefing, where she highlighted the potential impacts of a series of executive orders issued by former US President Donald Trump. These orders primarily target countries with a trade surplus against the US, with approximately 20 nations, including Indonesia, in the crosshairs.
Several countries, including Mexico, Canada, and China, have already faced tariffs as part of this initiative. These countries responded by imposing retaliatory tariffs on US imports.
For instance, Trump imposed a 10% tariff on energy products and a 25% tariff on other goods from Canada, 25% on imports from Mexico, and 10% on products from China.
In turn, China retaliated by imposing a 15% tariff on coal and liquefied natural gas (LNG), 10% on crude oil, and agricultural machinery from the US. Similarly, Canada applied a 25% tariff on a range of US products.
“The Trump administration is targeting countries with which the US has a trade deficit, or countries that have a trade surplus with the US. Around 20 nations are affected, including China, Mexico, and Vietnam, all of which have significant trade surpluses,” said Sri Mulyani during the APBN KiTA press conference in Central Jakarta on Thursday, March 13, 2025.
Indonesia’s Trade Surplus with the US
Indonesia is among the top 20 countries with a trade surplus against the US. In her briefing, Sri Mulyani explained the potential effects of Trump’s policies on Indonesia. These include disruptions in manufacturing supply chains, particularly in the digital sector, as well as volatility in commodity prices and market sentiment.
Sri Mulyani also emphasized that the concept of ‘friendshoring’—where countries trade primarily with trusted allies—appears to be eroding. This shift has been evident with the strained relations between the US and Canada, highlighting that even countries once considered reliable trade partners can be affected by shifting global dynamics.
“This makes countries rethink their economic strategies. What was once considered ‘safe’ through friendshoring is no longer guaranteed. How can Canada, once a close ally, find itself in this situation? The definition of ‘friends’ in today’s global economy is changing,” she noted.
According to the Central Statistics Agency (BPS), Indonesia recorded a trade surplus of US$31.4 billion in 2024, with its surplus against the US reaching an all-time high of US$16.84 billion. This surplus was largely driven by exports of machinery, electrical equipment, knitted clothing, and footwear.
India was Indonesia’s second-largest trade partner, with a surplus of US$15.38 billion. Key exports to India included mineral fuels, fats and vegetable oils, and steel.
Despite the substantial surplus, BPS data shows that the total trade balance in 2024 was lower than in 2023, when the surplus reached US$36.93 billion. The 2024 trade surplus of US$31.4 billion represented a decrease of US$5.84 billion from the previous year.
The non-oil and gas trade balance saw a surplus of US$51.44 billion, although it too was lower than the US$56.97 billion surplus in 2023.