Trump's Indonesia Trade Deal: Relief or Exploitation? Vantage with Palki Sharma
Trump's Indonesia Trade Deal: Relief or Exploitation? | Vantage with Palki Sharma | N18G
Donald Trump's latest trade deal with Indonesia slashes threatened tariffs but imposes steep costs on Jakarta. The agreement keeps a 19% U.S. tariff on Indonesian goods — nearly four times last year's rate — while granting American exports free access to Indonesia. Jakarta also pledged billions in purchases of U.S. oil, agriculture, and Boeing jets. Indonesia's President Prabowo accepted the deal to avoid harsher penalties but admitted it was tough. Critics say the agreement showcases Trump's coercive approach: threaten extreme tariffs, then demand one-sided concessions. The deal raises questions about whether this is negotiation — or economic pressure disguised as diplomacy.
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Express View on trade pacts and agriculture: Carry forward the momentum
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The US struck a framework trade agreement with the European Union on Sunday, imposing a 15% import tariff on most EU goods - half the threatened rate - and averting a bigger trade war between the two allies that account for almost a third of global trade. US President Donald Trump (R) shakes hands with European Commission President Ursula von der Leyen (L) following their meeting, in Turnberry south west Scotland on July 27, 2025.(AFP) US President Donald Trump and European Commission President Ursula von der Leyen announced the deal at Trump's luxury golf course in western Scotland after an hour-long meeting that pushed the hard-fought deal over the line, following months of negotiations. "I think this is the biggest deal ever made," Trump told reporters, lauding EU plans to invest some $600 billion in the United States and dramatically increase its purchases of U.S. energy and military equipment. Trump said the deal, which tops a $550 billion deal signed with Japan last week, would expand ties between the trans-Atlantic powers after years of what he called unfair treatment of U.S. exporters. Also Read | Explained: Donald Trump's landmark $1.35 trillion trade deal with EU before tariff deadline Von der Leyen, describing Trump as a tough negotiator, said the 15% tariff applied "across the board", later telling reporters it was "the best we could get." "We have a trade deal between the two largest economies in the world, and it's a big deal. It's a huge deal. It will bring stability. It will bring predictability," she said. The agreement mirrors key parts of the framework accord reached by the U.S. with Japan, but like that deal, it leaves many questions open, including tariff rates on spirits, a highly charged topic for many on both sides of the Atlantic. 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Trump retains the ability to increase the tariffs in the future if European countries do not live up to their investment commitments, a senior U.S. administration official told reporters on Sunday evening. The euro rose around 0.2% against the dollar, sterling and yen within an hour of the deal's being announced. MIRROR OF JAPAN DEAL Carsten Nickel, deputy director of research at Teneo, said Sunday's accord was "merely a high-level, political agreement" that could not replace a carefully hammered out trade deal: "This, in turn, creates the risk of different interpretations along the way, as seen immediately after the conclusion of the U.S.-Japan deal." While the tariff applies to most goods, including semiconductors and pharmaceuticals, there are exceptions. The U.S. will keep in place a 50% tariff on steel and aluminum. Von der Leyen suggested the tariff could be replaced with a quota system; a senior administration official said EU leaders had asked that the two sides continue to talk about the issue. Von der Leyen said there would be no tariffs from either side on aircraft and aircraft parts, certain chemicals, certain generic drugs, semiconductor equipment, some agricultural products, natural resources and critical raw materials. "We will keep working to add more products to this list," von der Leyen said, adding that spirits were still under discussion. A U.S. official said the tariff rate on commercial aircraft would remain at zero for now, and the parties would decide together what to do after a U.S. review is completed, adding there is a "reasonably good chance" they could agree to a lower tariff than 15%. No timing was given for when that probe would be completed. 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He has fumed for years about the U.S. merchandise trade deficit with the EU, which in 2024 reached $235 billion, according to U.S. Census Bureau data. The EU points to the U.S. surplus in services, which it says partially redresses the balance. Trump has argued that his tariffs are bringing in "hundreds of billions of dollars" in revenues for the U.S. while dismissing warnings from economists about the risk of inflation. On July 12, Trump threatened to apply a 30% tariff on imports from the EU starting on August 1, after weeks of negotiations failed to reach a comprehensive trade deal. The EU had prepared countertariffs on 93 billion euros ($109 billion) of U.S. goods in the event a deal to avoid the tariffs could not be struck.
