Jakarta. US President Donald Trump has imposed a steep 32 percent tariff on imports from Indonesia, significantly higher than the baseline 10 percent levied on many other countries.

The White House cited several reasons for applying the elevated tariffs, primarily targeting countries with which the United States has the largest trade deficits. 

According to data from Indonesia’s Trade Ministry, the country posted a trade surplus of $16.84 billion with the US in 2024 -- its largest with any single trading partner. This was followed by surpluses with India ($15.39 billion), the Philippines ($8.85 billion), Malaysia ($4.13 billion), and Japan ($3.71 billion).

In the first two months of this year alone, Indonesia recorded a $3.14 billion trade surplus with the US -- an increase from $2.65 billion during the same period in 2023 -- making the US the biggest contributor to Indonesia’s overall trade surplus.

"President Trump is working to level the playing field for American businesses and workers by confronting the unfair tariff disparities and non-tariff barriers imposed by other countries," the White House said in a statement on Wednesday.

Another key justification, according to the White House, lies in discrepancies in tariff rates applied under the Most-Favored-Nation (MFN) principle.

Countries such as Indonesia “did not agree to apply tariff rates on a reciprocal basis,” the statement said. As an example, Indonesia imposes a 30 percent tariff on ethanol imports, compared to the 2.5 percent US tariff on the same commodity.

“For generations, countries have taken advantage of the United States, tariffing us at higher rates,” the White House said.

In addition to tariffs, the US cited non-tariff barriers that hinder market access for American exporters. These include local content requirements, complex import licensing systems, and a new regulation requiring natural resource exporters to repatriate earnings to Indonesia for transactions valued at $250,000 or more.

“Indonesia maintains local content requirements across a broad range of sectors, complex import licensing regimes, and, starting this year, will require natural resource firms to onshore all export revenue for transactions worth $250,000 or more," the statement added.

President Trump officially announced the sweeping tariff measures during a press conference at the White House on Wednesday.

“Access to the American market is a privilege, not a right. The United States will no longer put itself last on matters of international trade in exchange for empty promises,” the White House said.

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