U.S. And Indonesia Formalize Landmark Trade Deal

WASHINGTON – The United States and Indonesia officially signed an Agreement on Reciprocal Trade on Friday, February 20, 2026, marking a significant step forward in their economic partnership. The agreement, endorsed by President Donald Trump and Indonesian President Prabowo Subianto, aims to expand market access and strengthen bilateral ties.

Key Terms of the Agreement

Under the agreement, Indonesia will eliminate tariff barriers on over 99% of U.S. Products exported across all sectors, including agriculture, health products, seafood, information and communications technology, automotive products and chemicals [1]. The U.S. Will maintain a 19 percent reciprocal tariff on Indonesian imports, with exemptions for specific products.

Zero-Tariff Products

Several Indonesian commodities will benefit from zero-tariff access to the U.S. Market, including textiles (under a Tariff Rate Quota mechanism based on U.S.-origin cotton and man-made fiber inputs), palm oil, coffee, cocoa, spices, rubber, electronic components (including semiconductors), and aircraft parts [1].

In return, Indonesia will provide zero-tariff facilities for U.S. Products, particularly agricultural goods like wheat and soybeans. This means Indonesian consumers will pay no tariffs on products made from these commodities, such as noodles, tofu, and tempeh [1].

Addressing Non-Tariff Barriers

The agreement also focuses on reducing non-tariff barriers to trade. Indonesia has committed to:

• Exempting U.S. Companies and goods from local content requirements.
• Accepting U.S. Federal motor vehicle safety and emission standards.
• Recognizing U.S. FDA standards for medical devices and pharmaceuticals.
• Removing burdensome certification and labeling requirements.
• Eliminating pre-shipment inspection requirements.
• Resolving longstanding intellectual property concerns [1].

Agreement Details and Signatories

The agreement was signed by Indonesian Coordinating Minister for the Economy Airlangga Hartarto and U.S. Trade Representative Jamieson Greer [2]. President Trump and President Subianto also signed a document confirming their commitment to implementing the broader “Toward a New Golden Age for the U.S.-Indonesia Alliance” agreement.

Removed Provisions

According to Indonesian officials, the United States agreed to remove provisions unrelated to economic cooperation from the agreement, including clauses concerning nuclear reactor development, South China Sea policy, and defense and border security matters [3].

Statements from Officials

“President Trump is unlocking Indonesia’s market of over 280 million people to create commercially meaningful opportunities for American farmers and manufacturers,” said Ambassador Greer [2].

The deal represents a recalibration of trade relations between the U.S. And Indonesia, combining a reciprocal tariff framework with extensive product-level exemptions and market access commitments.