ISEAS this week released a new commentary arguing that the US-Indonesia Agreement on Reciprocal Trade is widely viewed as asymmetrical, with Indonesia accepting broad commitments that could constrain its future policy space in industrial policy, digital regulation, and strategic trade governance in exchange for protected access to the US market.
The commentary states that Indonesia should introduce safeguards and renegotiate problematic provisions before ratification, ensuring that any ratification remains conditional and reversible, while pursuing domestically driven reforms regardless of the agreement’s fate.
Arianto A. Patunru, economist at the Indonesia Project, Crawford School of Public Policy, Australian National University stated:
Indonesia should consider conditional ratification with safeguards. It should engage, but not over-commit. ART can be useful as insurance against immediate US tariff pressure, especially for labour-intensive exporters and workers vulnerable to sudden market-access shocks. But it should not become a binding template for Indonesia’s long-term strategy. Ratification should be conditional, reversible, and subordinated to Indonesia’s broader regional strategy through ASEAN and RCEP.
Read the full commentary: The US-Indonesia Agreement on Reciprocal Trade: three views on its economic and strategic impacts