Policy and Legal

The Trump administration has released the text of a framework agreement with Indonesia yesterday, also announcing a deal with Japan that has not been made public yet.

Framework agreement with Indonesia: The document released yesterday is a framework for negotiating an “Agreement on Reciprocal Trade.” It includes some commitments but also lays the groundwork for more negotiations.

U.S. exports to Indonesia: Indonesia will “eliminate tariff barriers” on approximately 99% of U.S. industrial and agricultural exports.

• For context, U.S. manufacturing exports to Indonesia in 2024 were $6.5 billion of the $10.2 billion total. Manufacturing imports from Indonesia in 2024 were $25.4 billion of the $28 billion total.

U.S. imports from Indonesia: This agreement would reduce the U.S. tariff on imports from Indonesia to 19% from the 32% rate imposed by the Trump administration on April 2.

• Significantly, the agreement suggests the U.S. “may identify certain commodities not naturally available or domestically produced for further reduction in the reciprocal tariff rate.”
• This type of approach is exactly what the NAM has pushed for in its proposed U.S. Manufacturing Investment Accelerator Program, and it will continue advocating for such policies in subsequent trade agreements.

Critical minerals: Indonesia, which had previously banned exports of nickel, will also remove restrictions on exports to the U.S. of industrial commodities, including critical minerals.

Other key components: The agreement also achieves commitments by Indonesia on other key trade issues.

• Nontariff barriers: Indonesia will accept U.S. standards and certifications for vehicles, medical devices and pharmaceuticals, exempt certain U.S. products from local content requirements and also allow the import of U.S.-remanufactured goods.
• Digital trade: The country will also now support the World Trade Organization’s e-commerce moratorium on tariffs on electronic transmissions—something it had opposed previously and that is essential to manufacturers seeking to move information across borders.
• Steel: Indonesia pledged to join the Global Forum on Steel Excess Capacity, an approach the NAM supports to address unfair subsidization and excess production, particularly by China, that distort global markets.
• China: Indonesia will work with the U.S. to address the unfair practices of other countries and to cooperate on export controls, investment security and combatting duty evasion.
• Purchases: Indonesia has agreed to purchase U.S. aircraft, agricultural products and energy products.

More to come: President Trump has previewed agreements with the Philippines and Vietnam on social media, while Japanese officials have announced an agreement on tariffs at a press briefing. The NAM will report on the official details once they are available.

The bigger picture: Here are some other trade developments that the NAM is tracking:

• U.S. Treasury Secretary Scott Bessent will meet his Chinese counterpart in the coming days.
• President Trump will travel to Scotland for discussions on “finalizing” details in the U.K. deal.
• Talks with the EU, Canada and Mexico continue.
• And lastly, the president has signaled he may send letters setting a flat rate of 10–15% tariffs to some 150 countries.