Indonesian Government Urged to Respond Strategically to U.S. Tariff Hike, Push for WTO Reform
Jakarta, The Gulf Observer: The Indonesian government has been advised to adopt comprehensive measures in response to the recent 32-percent import tariff imposed by the United States on Indonesian products. Head of the House of Representatives’ Budget Committee (Banggar), Said Abdullah, emphasized the need for strategic action, including urging the World Trade Organization (WTO) to overhaul the global trade system in pursuit of fairness and sustainability.
In a statement delivered on Friday, Abdullah stressed that Indonesia must advocate for international trade rules that are equitable and supportive of shared economic prosperity. “I suggest that the government take initiatives, including urging the WTO to formulate policies that foster a healthier and fairer global trade environment and sustain global economic growth,” he said.
He cautioned against the use of trade policies by major powers as tools for unilateral advantage, warning that such practices could precipitate a global economic downturn. “Economic policies should not be driven solely by the interests of superpowers but must reflect universal economic values,” Abdullah added.
Highlighting the foundational principles of the WTO, Abdullah reminded the international community that the organization was established to promote non-discriminatory trade, build trade capacity, champion free trade, and serve as a forum for resolving trade disputes. “Indonesia needs to remind the world of this original mandate,” he asserted.
Alongside advocating for systemic reforms, the legislator called on the government to strengthen Indonesia’s domestic economy by diversifying export destinations to maintain a resilient trade surplus. He also emphasized the importance of enforcing Government Regulation No. 8 of 2025, which mandates exporters of natural resources to deposit foreign exchange earnings into domestic banks.
To reduce dependency on the U.S. dollar, Abdullah proposed deepening bilateral currency swap agreements with key trade partners. Additionally, he encouraged the implementation of counter-cyclical fiscal policies to help domestic businesses withstand global economic volatility without jeopardizing the country’s fiscal stability.
On investment, Abdullah urged the government to enhance infrastructure and develop more effective financial and capital market policies to boost investor confidence. “A more inclusive and robust ecosystem for the stock and financial markets is vital to preserving Indonesia’s appeal to global investors,” he said.
He concluded by stressing the importance of transparent and consistent government communication with the business sector, noting that reliable information and open dialogue would position the government as a dependable partner for economic stakeholders.
