Jayanty Nada Shofa, Jakarta – Indonesia has denied that it has picked sides in the major power rivalry, amidst concerns that the newly signed US trade agreement is one of Washington's tools to exclude China from global trade.
Jakarta recently wrapped up nearly a year of US deal negotiations with an agreement that economists fear to be too one-sided. While the final text does not explicitly state China, analysts believe that US President Donald Trump had included some clauses aimed at weakening Beijing's influence.
The pact commits Indonesia to mirror the import restrictions that Washington slaps against a "third country", fueling speculations that Jakarta has turned away from its traditional foreign policy of being "free and active". The Chinese government has stated that any bilateral cooperation "should not target any third party" in a response to the controversial clauses.
Foreign Ministry spokeswoman Yvonne Mewengkang assuaged worries about Indonesia's possible change of heart, citing that Jakarta is open to partnering with anyone.
"The Indonesia-US reciprocal trade agreement does not change the principles of our foreign policy. The free and active approach remains our compass. Our bilateral partnership is actually an instrument that helps us achieve our national interests," Yvonne told reporters in Jakarta on Friday.
"If you ask me whether an agreement threatens other countries, remember our free and active foreign policy," the diplomat said.
This decades-old doctrine sees Jakarta having the freedom to befriend anyone without being obliged to be tied to any superpowers or particular bloc. However, Muhammad Habib – an international relations analyst at the think-tank CSIS – pointed out its shortcomings. All this time, the "free and active" policy has only drawn the line at joining military pacts. It has yet to set the acceptable limits on economic alignments.
"We have not really defined the red lines for non-alignment in the economic sphere. And that's why we are prone to multiple interpretations. ... But I don't think Indonesia has really aligned with the US as we are in BRICS, ... although we still need to provide some reassurances," Habib said earlier that day.
The agreement is subject to lawmakers' approval and will only take effect 90 days after both sides finish the ratification processes. For context, BRICS is a China-led economic bloc that Trump has strongly disapproved of.
But a recent US Supreme Court ruling limited Trump's tariff powers, thereby throwing the Indonesian deal into uncertainty. The crushing defeat prompted Trump to unveil temporary 10% global tariffs with a plan to hike the duty to 15%. Both rates are lower than the 19% that Washington had agreed on.
Despite the changes, senior minister Airlangga Hartarto has signaled that the already-accepted tariff eliminations, such as on palm oil and electronic components, would stay in place.
"[The ruling] does not annul our reciprocal trade agreement. ... But we will receive a 'discount' of having the import duty down to 15%. The 0% rate [on the agreed products] will also remain," Airlangga said.
Source: https://jakartaglobe.id/news/us-deal-indonesia-denies-picking-sides-amid-china-concern