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View all search resultsTrade protectionism to persist in 2026
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A worker stacks rolls of fabric ready for export on April 15, 2025, at the Trisula Textile Industries factory in Cimahi, West Java. (AFP/Timur Matahari)
T
rade protectionism has become a new normal that economists say Indonesia will have to navigate carefully this year through market diversification.
In 2025, United States trade policy sharply escalated an already global trend toward protectionism, prompting other countries to rely more heavily on import tariffs and other unilateral measures to support domestic manufacturers and service providers.
A salvo of tariffs announced by US President Donald Trump in April shifted the trade paradigm of the world’s largest economy.
In addition to a sweeping 10 percent import tariff, the Trump administration also introduced what it called “reciprocal” tariffs, specific import duties targeted at countries enjoying a trade surplus with the US, like Indonesia.
Permata Bank chief economist Josua Pardede told The Jakarta Post on Dec. 23 that last year’s protectionist wave “is likely not just a temporary symptom but rather a policy pattern that will recur”.
Indonesia has enjoyed a surplus in bilateral trade with the US for some time. In 2024, the archipelago’s exports to the world’s largest consumer market exceeded its import from there by US$18 billion, prompting Washington to threaten Jakarta with a “reciprocal” 32 percent tariff on most Indonesian exports.
Jakarta was quick to negotiate with Washington, and the two sides in July announced a handshake deal to bring the rate down to 19 percent in exchange for various concessions from Indonesia.
