Jakarta. The Indonesian Association of Motor and Auto Parts Industries (GIAMM) has urged the government to consider imposing reciprocal tariffs on the United States following Washington's recent decision to raise import duties on products from several countries, including Indonesia.

“If they impose high tariffs, we need to respond in kind. Tariff for tariff. However, the government could also explore other options, such as adjusting import duties on US goods to restore balance,” GIAMM Secretary General Rachmat Basuki told news agency Antara on Sunday.

Indonesia had anticipated becoming a target of US tariffs under President Donald Trump and has been in ongoing talks with the White House since the beginning of this year in hopes of policy revisions. The government has coordinated with local businesses and plans to send a high-level delegation to Washington, D.C., to continue negotiations before the reciprocal tariffs take full effect on April 9.

Basuki voiced concern over the potential impact of the US tariff hikes on Indonesia’s automotive component exports. The US is Indonesia's second-largest export destination for auto parts after Japan, and higher tariffs could significantly hurt national export performance.

“Previously, the import duty to the US was relatively low. Now, with the hike, it becomes a major challenge for our industry players,” he added.

According to the Center of Economics and Law Studies (Celios),  Indonesia’s automotive exports to the US were valued at $280.4 million in 2023.

GIAMM is also monitoring the risk of a surge in Chinese automotive components flooding the domestic market. This potential influx is seen as a side effect of the US increasingly protectionist policies targeting Chinese goods.

To counter this, GIAMM proposed that the government not only rely on tariffs but also strengthen non-tariff barriers, such as enforcing local content requirements and mandatory Indonesian National Standards (SNI), to ensure the domestic industry is protected from low-quality or underpriced imports.

The association also called on the government to step up trade diplomacy efforts with international partners to safeguard national industrial interests and maintain the sector’s contribution to economic growth.

“Despite the challenges, we remain optimistic. The US market still holds potential. As long as the tariffs on Chinese products are higher than ours, our manufacturers still have room to compete,” said Basuki.

On April 2, US President Donald Trump announced a minimum 10 percent tariff hike on imports from various countries, including Indonesia. According to an official White House post on Instagram, Indonesia ranks eighth among the affected countries, with its products facing a 32 percent tariff increase.

In total, about 60 countries will be hit with retaliatory tariffs by the US, amounting to half the rate they currently impose on American goods.

Other Southeast Asian nations affected by the US tariffs include Malaysia (24 percent), Cambodia (49 percent), Vietnam (46 percent), and Thailand (36 percent).

Add as a preferred source on Google +