US President Donald Trump on Tuesday announced a trade agreement with Indonesia, unveiling a 19 per cent tariff on Indonesian goods.
The announcement, made via Trump’s Truth Social platform, follows weeks of negotiations aimed at avoiding a steeper 32 per cent duty he had previously threatened. Under the finalised agreement, Indonesia will buy $15 billion worth of US energy, $4.5bn in agricultural products, and 50 Boeing aircraft — many of them wide-body 777 jets.
“As part of the Agreement, Indonesia has committed to purchasing... and avoiding harsher tariffs,” Mr Trump posted, describing the development as a “great deal, for everybody”.
While the move drew little reaction from markets — Boeing stock remained largely unchanged following the news — the agreement appears to mark a step forward in Trump’s renewed push to reshape trade relations as part of his "reciprocal tariff" strategy. The implementation timeline for the lower 19pc tariff remains unclear, and the duration over which the purchases will be made has not yet been specified.
The deal comes after Trump reportedly held direct discussions with Indonesian President Prabowo Subianto. It also includes stricter measures against transshipped goods — products routed through third countries to avoid higher US tariffs — which will now face “steeper levies”, Trump said.
The agreement is the latest in a limited number of trade pacts Mr Trump has introduced since announcing plans in April for “90 deals in 90 days” after threatening sweeping tariff hikes on dozens of countries. So far, only a few such deals have been publicly confirmed, including with the United Kingdom, Vietnam, and a temporary easing of trade tensions with China.
Separately on Tuesday, the US president said that a trade deal with Vietnam was “pretty well set”, although he provided no fresh details. An earlier preliminary agreement with Hanoi had included a provision for a 40pc tariff on goods deemed to be illegally transshipped, but the criteria for such classifications have not been made public.
Speaking to reporters at Joint Base Andrews in Maryland, Trump downplayed the importance of releasing full details of the Vietnam pact, stating, “We have a Vietnam deal, and I would say that that deal is being pretty well set.”
Meanwhile, Mr Trump also announced that smaller countries would soon be informed of their own updated tariff rates, likely around “a little over 10pc”. More than 20 such letters have already been sent to trading partners, including Japan, South Korea, Malaysia, and members of the European Union. Canada and Mexico — which were not originally included in Trump’s tariff campaign — have also received notifications.
The announcement regarding Indonesia follows two postponements of steeper tariffs that were initially set to take effect on July 9. The deadline was first extended and then pushed to August 1 to allow for ongoing talks.
Reacting to the agreement, former Indonesian vice foreign minister Dino Patti Djalal said at a Foreign Policy event that government officials in Jakarta were satisfied with the outcome of the negotiations.
Trade analysts, however, remain cautious. While the announced deals appear to signal progress in Trump’s broader strategy to rebalance global trade, several of the agreements — including those with Vietnam and the EU — remain short on detail.
