Indonesia Dodges US Section 301 Extra Tariff Threat

RRI.CO.ID, Jakarta - Indonesia has secured a tariff exemption from the United States in exchange for its commitment to enforce labor laws. Previously, Washington had threatened to impose a 12.5 percent import tariff under Section 301 of the US Trade Act of 1974.

That provision prohibits the import of goods produced through forced labor. At least 60 countries faced the threat of additional tariffs after the US claimed to have conducted an investigation.

To that end, Coordinating Minister for Economic Affairs Airlangga Hartarto met with the US Trade Representative (USTR) on the sidelines of the 2026 OECD Ministerial Meeting in Paris on Thursday, June 5, local time.

“The US government, through the USTR, has announced a positive acknowledgment of Indonesia’s progressive commitments to enforcing labor laws, particularly regarding the resolution of forced labor issues and the ban on imports of products suspected of involving forced labor,” Minister Airlangga said in a written statement.

As a result, Indonesia has been included in the six priority countries (Good Group) out of 60 eligible for special consideration by the US government. The other countries are Canada, Ecuador, the European Union, Mexico, and Pakistan.

Minister Airlangga added that Indonesia has been assigned a 10 percent tariff under Section 301 of the Trade Act, based on the investigation’s findings. Meanwhile, the other 54 countries will face a 12.5 percent tariff.

Special consideration was granted because Indonesia has an Agreement of Reciprocal Trade (ART). The Ministry of Trade has also issued Ministerial Regulation No. 9/2026, prohibiting the import of goods produced through forced labor.

“The USTR plans to grant 18 requests for product exclusions submitted by Indonesia under the Section 301 investigation,” Minister Airlangga noted. He said the plan would serve as an economic stimulus for the national industrial sector.

The exemption from US import tariffs will reduce export costs and enhance the competitiveness of Indonesia’s flagship commodities in the US market.

Minister Airlangga also expressed appreciation to USTR Chief Ambassador Jamieson Greer. “The facilitation of this tariff exemption is tangible proof of international confidence in Indonesia’s efforts to remove bottlenecks,” he concluded in Paris. (Gusti Panji)