Washington, D.C., July 23 (ANI): The United States and the Republic of Indonesia have agreed on a framework for negotiating an Agreement on Reciprocal Trade to strengthen bilateral economic ties, the White House said in a joint statement Tuesday.
The agreement aims to give exporters from both countries unprecedented access to each other’s markets and builds on the U.S.-Indonesia Trade and Investment Framework Agreement signed on July 16, 1996.
According to the statement, “Indonesia will eliminate approximately 99 percent of tariff barriers for a full range of U.S. industrial and U.S. food and agricultural products exported to Indonesia.”
The United States, in turn, “will reduce to 19 percent the reciprocal tariffs, as set forth in Executive Order 14257 of April 2, 2025, on originating goods of Indonesia, and may also identify certain commodities that are not naturally available or domestically produced in the United States for a further reduction in the reciprocal tariff rate,” the statement added.
The two countries also plan to negotiate facilitative rules of origin to ensure the benefits of the agreement accrue primarily to the U.S. and Indonesia.
The framework addresses non-tariff barriers as well. “The United States and Indonesia will work together to address Indonesia’s non-tariff barriers that affect bilateral trade and investment in priority areas, including exempting U.S. companies and originating goods from local content requirements; accepting vehicles built to U.S. federal motor vehicle safety and emissions standards; accepting FDA certificates and prior marketing authorizations for medical devices and pharmaceuticals; removing certain labeling requirements; exempting U.S. exports of cosmetics, medical devices, and other manufactured goods from certain requirements; taking steps to resolve many long-standing intellectual property issues identified in USTR’s Special 301 Report; and addressing U.S. concerns with conformity assessment procedures,” the statement said.
Indonesia also agreed to remove import restrictions or licensing requirements on U.S. remanufactured goods or their parts, eliminate pre-shipment inspections or verification requirements on U.S. imports, and adopt good regulatory practices.
On agricultural cooperation, the statement noted that the two nations committed to “address and prevent barriers to U.S. food and agricultural products in the Indonesian market, including exempting U.S. food and agricultural products from all import licensing regimes, including commodity balance requirements; ensuring transparency and fairness with respect to geographical indications; providing permanent Fresh Food of Plant Origin (FFPO) designation for all applicable U.S. plant products; and recognizing U.S. regulatory oversight, including listing of all U.S. meat, poultry, and dairy facilities and accepting certificates issued by U.S. regulatory authorities.”
The framework also covers digital trade, labor rights, and environmental cooperation. Indonesia pledged to remove barriers to digital trade, eliminate tariffs on intangible products, and support a permanent moratorium on customs duties on electronic transmissions at the WTO.
Indonesia committed to protecting internationally recognized labor rights, prohibiting imports of goods produced by forced or compulsory labor, amending labor laws, and strengthening enforcement.
On the environment, Indonesia agreed to adopt and maintain high levels of environmental protection, improve forest governance, and combat illegal fishing and wildlife trade.
Regarding industrial exports, Indonesia will remove restrictions on exports of industrial commodities, including critical minerals, to the U.S.
The countries also pledged to enhance economic and national security cooperation to strengthen supply chain resilience and address unfair trade practices by other countries. They plan to cooperate on export controls, investment security, and preventing duty evasion.
The statement also acknowledged upcoming commercial deals, including the procurement of aircraft valued at $3.2 billion, agricultural purchases estimated at $4.5 billion, and energy product purchases estimated at $15 billion.
In the coming weeks, the United States and Indonesia will negotiate and finalize the Agreement on Reciprocal Trade, prepare it for signature, and complete domestic formalities before it enters into force, the White House concluded. (ANI)
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