Indonesia just dodged a 32% tariff bullet from the US—but at what cost to American jobs, manufacturing, and the very principle of fair trade that President Trump vowed to restore after years of disastrous, one-sided deals?
At a Glance
- President Trump secured a new trade pact with Indonesia, lowering threatened tariffs from 32% to 19% in exchange for major Indonesian purchases of US goods.
- Indonesia committed to buying $15 billion in US energy, $4.5 billion in agricultural products, and 50 Boeing jets.
- Critics warn the deal is “one-sided,” with Indonesia’s exports still facing significant tariffs while US goods enter Indonesia tariff-free.
- The agreement is already being called a model for future deals with countries like India, ramping up pressure on America’s trading partners.
Trump’s Trade Tactics Force Indonesia to the Table
President Trump put Indonesia on notice in April 2025, threatening a punishing 32% tariff on their exports—a move that sent shockwaves through Jakarta’s government. With Indonesia’s trade surplus with the US ballooning to $17.9 billion last year, the Trump administration saw a familiar pattern: America getting the short end of the stick while foreign partners rake in the profits. Trump’s playbook is no secret—use America’s unrivaled economic weight to force partners into buying more US goods and leveling the playing field for once.
Jakarta moved fast. President Prabowo Subianto, desperate to protect Indonesia’s export markets, picked up the phone and spoke directly with President Trump—skipping the bureaucrats and getting straight to a deal. By July 15, Trump announced the new pact: Indonesia’s tariff would be slashed to 19% instead of 32%, but only if Indonesia agreed to open its markets wide to US products and make blockbuster purchase commitments.
The Deal: Winners, Losers, and American Leverage
Under the agreement confirmed on July 16, Indonesia agreed not just to accept a 19% tariff on its exports, but also to buy $15 billion in American energy, $4.5 billion in agricultural goods, and—perhaps most crucially for US manufacturing—50 Boeing jets. For American workers and companies battered by years of lopsided deals and manufacturing flight, this looks like a win. Trump’s team made it clear: you want access to the US market, you open yours to us and support US jobs.
But is it enough? Experts in Indonesia are already complaining the deal is “one-sided,” arguing that Indonesia got the short straw: their exports are still facing a stiff 19% tariff, while US goods breeze in tariff-free. The Center of Economic and Law Studies warns this could threaten Indonesia’s own trade balance, making their industries even more dependent on American demand. That’s leverage, and it’s exactly what the US needs after years of being taken for a ride.
A New Era—or Just More of the Same?
Both sides are spinning this as a new era in US–Indonesia relations. President Prabowo called the agreement a “new era” of mutual benefit, and the Indonesian government is already touting the high-level, direct nature of the negotiation as a diplomatic victory. Trump, meanwhile, is using this as a template for negotiations with other partners—India, Vietnam, and beyond—making clear that the days of America playing patsy in international trade are over.
But let’s not kid ourselves. While Trump’s hardball tactics forced Indonesia to the table, the US still faces a global environment of partners desperate to shield their own industries while flooding ours with cheap goods. Indonesian exporters are already bracing for higher costs and lost market share, while American companies stand to benefit—at least in the short term—from increased sales and government-backed purchase commitments. The question is whether these deals will finally deliver the economic security and job growth that American families have been waiting for—or just paper over decades of failed policy with a fresh set of promises.
Sources:
Stratfor, “Indonesia, U.S.: Jakarta Confirms Trade Deal with Washington,” July 16, 2025.
