Indonesia plans business incentives to advance US tariff talks

Jakarta (ANTARA) - The Indonesian government intends to offer facilities and incentives to US companies operating in the country to smooth the ongoing negotiations over the new 32 percent import tariff.

"We will certainly offer incentives and facilitate permit-obtaining processes," Indonesian Coordinating Minister for Economic Affairs Airlangga Hartarto remarked at a press conference followed virtually from Jakarta on Friday.

While speaking in Washington, D.C., Hartarto announced the government’s plan to form a deregulation team dedicated to simplifying rules and regulations to make business operations easier for investors.

According to the minister, Indonesia acknowledged that complex domestic regulations had been obstructing trade and investment activities in its soil.

Hartarto also highlighted that President Prabowo Subianto supports this deregulation effort, as reflected in his push to ease requirements related to the domestic component level (TKDN).

During an economic forum in Jakarta on April 8, the president emphasized that more flexible TKDN rules could attract greater investment and help maintain the competitiveness of Indonesia’s industries.

In line with this, Hartarto confirmed that the US had requested more favorable TKDN specifications for certain products.

"We are working on it," the minister added.

Hartarto is part of the diplomatic delegation dispatched by President Prabowo to the US to negotiate with President Donald Trump’s administration regarding the newly announced 32 percent tariff on Indonesian products imported into the US.

In addition to Indonesia, the US has imposed tariffs on other Southeast Asian nations: 17 percent on the Philippines, 10 percent on Singapore, 24 percent on Malaysia, 49 percent on Cambodia, 36 percent on Thailand, and 46 percent on Vietnam.

However, on April 9, just one week after announcing the tariff policy, President Trump agreed to a 90-day pause in implementation for most affected countries, including Indonesia, but excluding China, which instead faces increasingly higher tariffs following its constant retaliatory measures.