Hartarto explained that if the original 32 percent reciprocal tariff had remained in place, millions could have lost their jobs.
“If the 32 percent tariff were implemented, we could face five million layoffs. If the tariff is only 19 percent, there will be no layoffs. This is the important difference,” he remarked on Tuesday.
Hartarto noted that the 19 percent reciprocal tariff policy agreed upon by Indonesia and the US for Indonesian goods entering the US has significantly altered the import tariffs applied to US goods entering Indonesia.
Before this policy, US goods were subject to tariffs ranging from 10 to 20 percent. Under the new policy, US goods can enter Indonesia tariff-free, although trade continues.
“If the tariff increased to 32 percent, it would mean a complete halt to trade. However, with a 19 percent tariff, our position in ASEAN remains competitive, on par with Malaysia and Thailand. Meanwhile, India is subject to a 25 percent tariff and Vietnam a 20 percent tariff,” the minister explained.
Given Indonesia’s competitiveness within ASEAN, he believes worker sustainability will be ensured, with no companies relocating outside Indonesia.
“We are grateful that no factories will relocate from Indonesia to other countries. No factories will close. It is safe,” he ensured.
US President Donald Trump announced that reciprocal import tariffs would take full effect on August 7, 2025.
Several countries are subject to varying tariffs, such as the United Kingdom at 10 percent; Vietnam, 20 percent; the Philippines, 19 percent; Japan, 15 percent; and South Korea, 15 percent.
The European Union is also subject to a 15 percent tariff on certain products.
Indonesia faces a 19 percent tariff, contingent on conditions like import obligations and opening access to Indonesian data.
Related news: Indonesia negotiating lower US tariffs for some goods
Related news: US tariff agreement to boost productivity in some sectors: minister
Related news: US tariff cut to boost Indonesia’s economy: DEN
Translator: Ricky Prayoga, Resinta Sulistiyandari
Editor: Azis Kurmala
Copyright © ANTARA 2025
