The trade agreement between the United States and Indonesia is at risk of collapsing following renewed tensions over commitments made by Jakarta, according to a senior U.S. official.
The official said Indonesia had backtracked on parts of the deal reached in July, noting that elements previously agreed upon are now being questioned. The remarks were made on condition of anonymity, with no specific commitments disclosed.
Indonesian authorities, however, insisted that negotiations remain active. A spokesperson for the Indonesian Ministry for Economic Affairs, Haryo Limanseto, said the discussions are ongoing and described the developments as normal negotiation dynamics, expressing optimism that both sides would reach a mutually beneficial agreement.
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Indonesia had earlier agreed to eliminate tariffs on more than 99% of U.S. goods and remove non-tariff barriers affecting American firms, while the U.S. committed to reducing tariffs on Indonesian exports from 32% to 19%.
The deal was first announced on July 15 by Donald Trump, who described it as a major win for American industries, workers and manufacturers.
However, the U.S. official disclosed that Indonesian negotiators had informed the Office of the United States Trade Representative that Jakarta could no longer agree to some binding commitments and wanted to reframe parts of the agreement.
U.S. officials also expressed concern that any revisions could weaken the deal compared to recent U.S. trade agreements with Malaysia and Cambodia.
Sources familiar with the matter said disputes also involve the elimination of non-tariff barriers on industrial and agricultural exports and unresolved digital trade commitments.
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The Financial Times first reported details of the renewed tensions. Meanwhile, Jamieson Greer received complaints from Indonesian officials seeking changes to the deal’s binding terms.
Last week, Scott Bessent said Indonesia was becoming less cooperative in the talks but praised Malaysia for implementing wide-ranging tariff reductions.
The situation has raised fresh uncertainty over the future of the U.S.–Indonesia trade agreement, as both sides attempt to salvage the deal.
Esther Ososanya is an investigative journalist with Pinnacle Daily, reporting across health, business, environment, metro, Fct and crime. Known for her bold, empathetic storytelling, she uncovers hidden truths, challenges broken systems, and gives voice to overlooked Nigerians. Her work drives national conversations and demands accountability one powerful story at a time.
