WASHINGTON/BRUSSELS — President Donald Trump on Tuesday said the US would impose a 19 percent tariff on goods from Indonesia under a new agreement with the Southeast Asian country and more deals were coming, while offering fresh details on planned duties on pharmaceuticals.
Trump announced the pact with Indonesia, a relatively minor US trading partner, as he continued to press for what he views as better terms with trading partners and ways to shrink a huge US trade deficit. Letters setting tariff rates for dozens of smaller countries were also coming soon, he said on Tuesday.
The deal with Indonesia is among the handful struck so far by the Trump administration ahead of an August 1 deadline when duties on most US imports are due to rise again. The accord came as the top US trading partner – the European Union – readied retaliatory measures should talks with Washington fail.
As that deadline approached, negotiations were under way with other nations eager to avoid more US levies beyond a baseline 10 percent on most goods that has been in place since April.
Trump’s roll-out of the policies has often been chaotic. His moves have upended decades of negotiated reductions in global trade barriers, unsettling international financial markets and threatening a new wave of inflation.
Based on Trump tariff announcements through Sunday, Yale Budget Lab estimated the US effective average tariff rates will rise to 20.6 percent from between 2 percent and 3 percent before Trump’s return to the White House in January. Consumption shifts would bring the rate down to 19.7 percent, but it’s still the highest since 1933.
Trump outlined an Indonesia deal similar to a preliminary pact struck recently with Vietnam, with a flat tariff on exports to the US roughly double the current 10 percent and no levies on US exports going there. It also included a penalty rate for so-called transhipments of goods from China via Indonesia and a commitment to buy some US goods.
“They are going to pay 19 percent and we are going to pay nothing … we will have full access into Indonesia, and we have a couple of those deals that are going to be announced,” Trump said outside the Oval Office. Trump later said on his Truth Social platform that Indonesia had agreed to buy $15 billion of US energy products, $4.5 billion of American farm products and 50 Boeing BA.N jets, though no time frame was specified.
He told reporters the deal with Vietnam was “pretty well set” but said it was not necessary to release details.
Trump: India talks moving same way
Indonesia’s total trade with the US – totalling just under $40 billion in 2024 – does not rank in the top 15, but it has been growing. US exports to Indonesia rose 3.7 percent last year, while imports from there were up 4.8 percent, leaving the US with a goods trade deficit of nearly $18 billion.
The top US import categories from Indonesia, according to US Census Bureau data from the International Trade Centre’s TradeMap tool, last year were palm oil, electronics equipment including data routers and switches, footwear, car tires, natural rubber and frozen shrimp.
Susiwijono Moegiarso, a senior official with Indonesia’s Coordinating Ministry for Economic Affairs, told Reuters in a text message: “We are preparing a joint statement between US and Indonesia that will explain the size of reciprocal tariff for Indonesia including the tariff deal, non-tariff and commercial arrangements. We will inform (the public) soon.”
Trump had threatened the country with a 32 percent tariff rate starting August 1 in a letter sent to its president last week. He sent similar letters to about two dozen trading partners this month, including Canada, Japan and Brazil, laying out tariff rates ranging from 20 percent to 50 percent, plus a 50 percent tariff on copper.
Speaking in Pittsburgh on Tuesday, Trump said he favored blanket tariffs over complicated negotiations, but his Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick were keen to land more trade agreements.
Upon his arrival back in Washington, Trump told reporters that letters would be going out soon for many smaller countries, suggesting they would face a tariff of “a little over 10 percent.”
