Illustrative image (Source: VNA) Jakarta (VNA) - As the US and China are locked in a trade spatthrough mutual hiking of tariffs, Indonesia looks likely to be dragged intowhat may escalate into a global trade war.
Experts of the East Asia Summit said that in a bid to address the tradesurplus of around 9 billion USD enjoyed by Indonesia against the US, PresidentDonald Trump reportedly wants to revoke the special tariffs his country appliesto Indonesian products, especially in textiles, which is bound to bedetrimental to the Indonesian economy.
Despite not ruling out retaliatory tariffs, Indonesian Trade MinisterEnggartiasto Lukita said he would first prioritise trade diplomacy. Incontrast, those in the textile industry want to see a more militant approach.
Chairman of the Indonesian Textile Association Ade Sudrajat told theJakarta Globe news outlet that if a higher tariff is imposed, it will createa huge obstacle for the textile industry, which must be countered. He suggestedthat Indonesia could use its sizeable imports of US agricultural produce as abargaining chip, given that American soybeans make up about 70 percent of the nationalconsumption.
However,experts said imposing a high import duty on soybeanswould naturally result in price hikes for its derivative products, thusaffecting local lives. With the national legislative and presidential electionscoming up next year in Indonesia, the Government will without fail try to curbinflation, especially for daily staples, as best as it can.
Indonesian authorities have taken diplomaticendeavours to deal with difficulties, negotiating with the US government at alllevels and pursuing a multilateral effort through ASEAN to maximise trade diplomacywith the US.
The current US-China trade showdown is estimatedto result in a cascading effect throughout Asia as goods made in China,electronics for instance, often incorporate components manufactured elsewhereon the continent, notably in the Southeast Asian countries of Thailand, Vietnam,and Malaysia. A full-blown trade war between the world’s two biggest economiesmay also see global trade traffic decimated, affecting port cities likeSingapore. -VNA
Experts of the East Asia Summit said that in a bid to address the tradesurplus of around 9 billion USD enjoyed by Indonesia against the US, PresidentDonald Trump reportedly wants to revoke the special tariffs his country appliesto Indonesian products, especially in textiles, which is bound to bedetrimental to the Indonesian economy.
Despite not ruling out retaliatory tariffs, Indonesian Trade MinisterEnggartiasto Lukita said he would first prioritise trade diplomacy. Incontrast, those in the textile industry want to see a more militant approach.
Chairman of the Indonesian Textile Association Ade Sudrajat told theJakarta Globe news outlet that if a higher tariff is imposed, it will createa huge obstacle for the textile industry, which must be countered. He suggestedthat Indonesia could use its sizeable imports of US agricultural produce as abargaining chip, given that American soybeans make up about 70 percent of the nationalconsumption.
However,experts said imposing a high import duty on soybeanswould naturally result in price hikes for its derivative products, thusaffecting local lives. With the national legislative and presidential electionscoming up next year in Indonesia, the Government will without fail try to curbinflation, especially for daily staples, as best as it can.
Indonesian authorities have taken diplomaticendeavours to deal with difficulties, negotiating with the US government at alllevels and pursuing a multilateral effort through ASEAN to maximise trade diplomacywith the US.
The current US-China trade showdown is estimatedto result in a cascading effect throughout Asia as goods made in China,electronics for instance, often incorporate components manufactured elsewhereon the continent, notably in the Southeast Asian countries of Thailand, Vietnam,and Malaysia. A full-blown trade war between the world’s two biggest economiesmay also see global trade traffic decimated, affecting port cities likeSingapore. -VNA
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