Indonesia wants fair and equal relationship with US, President says

JAKARTA (Reuters) -Indonesia wants a fair and equal relationship with the U.S., and will pursue diplomacy to address a 32% tariff rate imposed by the Trump administration, President Prabowo Subianto said on Monday, while his ministers are working to finalise its negotiation proposal.

"We will also open negotiations with America. We will say, we want a good relationship. We want a fair relationship. We want an equal relationship," Prabowo said during a rice harvesting event in West Java.

Jakarta has said it would pursue negotiations rather than retaliate against the U.S. tariffs, and will send a high-level delegation to the United States.

Indonesia is among six Southeast Asian countries that were slapped with high tariffs by U.S. President Donald Trump last week. The levies are set to take effect on April 9.

Prabowo's cabinet ministers have been working on a proposal to address the tariffs by offering to buy more U.S. products such as cotton, wheat, oil and gas, as well as pledging to resolve non-tariff barriers and possible tax cuts on U.S. goods.

Airlangga Hartarto, the chief economic minister who will lead Indonesia's high-level delegation to U.S., met with more than a hundred business associations on Monday to gather inputs.

Following the meeting, the government came up with a plan to increase imports from the U.S., including buying components for an oil refinery project and reviewing the possibility to reduce a local content rule for U.S. tech and communication firms.

The finance ministry said its fiscal posture is unchanged at the moment and it will try to maintain it amid the current situation. It has set a higher 5.2% GDP growth target this year, versus 5.03% last year. The fiscal deficit will be maintained at 2.53% of GDP.

Indonesia posted a $16.8 billion trade surplus last year with the U.S., which was its third-biggest export destination, receiving shipments worth $26.3 billion in 2024, according to Indonesian government data.

Indonesia’s main exports to the U.S. include electronics, apparel and clothing, and footwear. Jakarta will support labour intensive industry from the impact of the tariffs, which are also affecting financial investors' appetite for emerging markets.

The archipelago's economy has struggled in recent weeks, hit by a stock market selloff and currency slump. The rupiah is its lowest since the 1998 financial crisis and its main stock index slid as much as 7.1% last month.

Bank Indonesia said on Monday it would "intervene aggressively" in domestic foreign exchange markets when they reopen on Tuesday after a public holiday break since March 28.

(Reporting by Stefanno Sulaiman; Editing by John Mair and Christian Schmollinger)