Businesspeople have identified several sectors most impacted by the reciprocal tariff policy implemented by United States President Donald Trump. These include garments, furniture, and footwear.

Shinta Kamdani, Chairwoman of the Indonesian Employers' Association (APINDO), stated that the policy would negatively impact export performance and domestic industry. Trump announced reciprocal tariffs on several countries. Indonesia was one of the countries affected by the policy, with import tariffs of 32%.

"Indonesia's exports to the US are unlikely to stop completely, and the comparative competitiveness of Indonesian export products is unlikely to change drastically, given that so many countries are affected by the tariffs. However, we project a decline in export demand in the US market in the short term due to the market shock from inflation resulting from the implementation of these tariffs in the US market," Shinta told detikcom on Friday (April 4, 2025).

Shinta also stated that industries with a larger market share in the US will have a harder time surviving this situation. According to her, at least a number of sectors, such as garments, footwear, furniture, and fisheries, are impacted by import tariffs due to their larger export markets in the US.

"In our preliminary estimates, the garment, footwear, rubber, fisheries, and furniture sectors will be severely impacted due to their large share of exports to the US and the nature of their respective industries, which are linked to MSMEs in their supply chains. This could be due to a lack of flexibility to create immediate export diversification," Shinta explained.

Meanwhile, other sectors, such as crude palm oil (CPO), biofuels, electronic components, and even vehicle engines, could be impacted by Trump's import tariff policy. However, Shinta stated that these sectors could survive due to greater flexibility and continued domestic demand.

"Other sectors, such as crude palm oil (CPO), biofuel, electronic components, machinery, and vehicles, have also been negatively impacted. However, we estimate these sectors will be more resilient and flexible, potentially diversifying their production demand to other destination countries or driven by domestic market demand," Shinta added.

Meanwhile, Anindya Novyan Bakrie, Chairman of the Indonesian Chamber of Commerce and Industry (Kadin), stated that the policy would significantly impact the balance of payments, particularly the trade balance and investment flows. He further noted that the US is the largest supplier of foreign exchange, contributing to a trade surplus of US$16.8 billion in 2024.

"Almost all of Indonesia's primary commodity exports to the US increased in 2024. Most of Indonesia's exports to the US are manufactured products, namely electrical equipment, footwear, and clothing, rather than raw commodities," Anindya said in his statement.

According to Anindya, Indonesian products have been subject to import tariffs of around 10% in the US. However, some consumer goods are actually completely duty-free because Indonesia enjoys the Generalized System of Preferences (GSP) facility granted by the US government to developing countries.

To strengthen the trade balance after Trump's decision, Anindya believes trade negotiations can be conducted more selectively. Focus can be placed on labor-intensive industries impacted vertically, from upstream to downstream. Furthermore, Indonesia needs to open new markets beyond the Asia Pacific and ASEAN, including Central Asia, Türkiye, and Europe, as well as Africa and Latin America.