Indonesia’s US trade deal faces a sovereignty reckoning at home

Indonesia went to Washington to negotiate a trade deal and came home with more than 200 obligations to America’s nine.A day after the signing, the US Supreme Court struck down the legal basis for the tariff threat that had driven the whole exercise – for a time, at least.Detractors have likened this “agreement on reciprocal trade” to a blank cheque and a surrender of Indonesia’s sovereignty. The government, for its part, calls it a win-win.The deal was signed by President Prabowo Subianto on February 19, when a threatened 32 per cent US tariff on Indonesian exports still seemed like it might come to pass.It fixed that rate at 19 per cent and secured zero-tariff access for 1,819 goods, including palm oil, coffee, cocoa, rubber and spices, that are central to the Indonesian economy.Workers in Indonesia transfer harvested palm oil fruits onto a truck to be processed into palm oil. Photo: AFPIn exchange, Jakarta agreed to extend tariff exemptions to more than 99 per cent of American goods and strip away key non-tariff barriers – among them some local content requirements and halal certification – for US companies operating in Indonesia.