Heaptalk, Jakarta — As one of the countries affected by US President Donald Trump’s 32% import policy, Indonesia’s 10th and 12th Vice President Jusuf Kalla (JK) urged the government to clarify the matter regarding products from the US sold in Indonesia, which are subject to a 64% tax.
“Negotiation means lowering that tariff. The basis is that it’s considered American, so we apply a 64% tariff. Where is the 64% from? What number is that? The 32% tariff- let’s negotiate that. Where’s the proof that this is incorrect? “So, if we can prove that applying just 30% of the tariff will result in only 15%,” he said on Monday (04/07).
Furthermore, JK stated, “There are two prices: an import price, for example, shoes costing US$15–US$20, and a retail price of US$50–US$70.” What affects the Indonesian people (in terms of tariffs) is the retail price. While the 32% tariff is applied to the import price. So, the impact isn’t 32%, but only 10%.
On the other hand, Kalla noted that Indonesia’s position is not like China, which has been exporting more finished goods to the US. Even large retailers in the United States are dominated by goods manufactured in China. Therefore, Indonesia cannot retaliate with import tariffs on the US. “China has more factories producing finished goods. If you go to Walmart in the United States, approximately 90% of the products sold are made in China, all of which are finished goods. But not us. Most of our products are raw materials, like shoes, but they are also inexpensive,” he added.
Jusuf Kalla mentioned that Indonesia does not need to impose retaliatory tariffs on the US, as the affected tariffs in Indonesia are only about 10% of Indonesia’s exports. He said, “It’s only Rp26 billion compared to their trillion-dollar imports. It won’t have much of an impact.
According to data from the Ministry of Trade, Indonesia’s export value to the US was US$26.31 billion for the entire year of 2024, with a trade balance showing a surplus of US$14.34 billion. JK believes this number is significantly smaller than China’s as Indonesia primarily imports raw materials, unlike China, which imports more finished goods or high-value-added products.
In addition to negotiations, Kalla proposed that the government clarify the costs imposed on US products entering Indonesia. He hopes that this step could lead to changes in Trump’s policies for Indonesia. “We’re hit with a 32% tariff. Is it true that American products are subjected to a 64% tax or fee? Where does that 64% come from? So, it’s our job to clarify this. I believe this is a political issue, and it has a more pressure effect,” Jusuf Kalla concluded.
