Jakarta. Indonesia is ready to implement its reciprocal trade agreement with the United States but is waiting for Washington to take more definitive steps regarding a separate Section 301 investigation, the US-ASEAN Business Council (USABC) has said.

The Agreement on Reciprocal Trade (ART), signed by President Prabowo Subianto and US President Donald Trump on Feb. 19, 2026, has yet to enter into force, USABC President Brian McFeeters said at the council media briefing in Jakarta on Friday.

“What we heard this week is the government of Indonesia is waiting for more definitive steps from the United States on the 301 investigation, which relates to other categories of tariffs,” Brian said.

He added that the Indonesian government was ready to move forward with implementation.

“The main point is we heard that the government of Indonesia is ready to move ahead with implementation,” he said.

The Section 301 investigation adds another layer of uncertainty to Indonesia's trade relations with Washington. Launched in March 2026, the US investigation targets 16 economies, including Indonesia, over alleged structural excess manufacturing capacity. A separate investigation examines alleged failures to prevent the use of forced labor in global supply chains across 60 economies.

Under Section 301 of the US Trade Act of 1974, the US Trade Representative (USTR) can investigate trade practices considered unfair or harmful to American interests and recommend measures that include additional tariffs.

Around 38% of Indonesia's exports to the US in 2025 fell within product categories covered by the Section 301 investigation, equivalent to approximately 4.2% of the country's total global exports, according to a March 2026 analysis by the Institute for Economic and Social Research at the University of Indonesia (LPEM UI).

However, LPEM UI questioned the basis of the US allegations, arguing that industrial capacity in several affected Indonesian sectors showed signs of underutilization rather than aggressive export expansion. The institute also said the allegations did not establish a clear link between Indonesia's industrial policies and direct harm to US industries.

The agreement's implementation remains subject to the completion of domestic legal procedures by both governments. Under the ART, it will enter into force 90 days after Indonesia and the United States exchange written notifications confirming that their respective legal procedures have been completed, unless both sides agree on another date.

In its October 2026 white paper, 8 Recommendations for Indonesia's 8% Economic Growth, USABC also calls for stronger implementation of trade agreements, urging the government to establish clear timelines, assign responsibilities to relevant agencies and provide channels for businesses to resolve trade-related problems.

The council argues that trade agreements need to be translated into clear rules and procedures before businesses can fully benefit from their market-access commitments.

The Indonesia-US ART is among Indonesia's trade arrangements, alongside the Regional Comprehensive Economic Partnership (RCEP) and the Indonesia-European Union Comprehensive Economic Partnership Agreement.

Brian said implementing the agreement was important to address concerns raised by American businesses operating in Indonesia and advance the council's recommendations.

Add as a preferred source on Google +