Tariff negotiation countdown! Indonesia is working on two fronts: relaxing import restrictions and inviting the US to jointly build key mineral projects.

According to reports, as the July 9 deadline for tariff negotiations approaches, Indonesia has announced that it will relax import restrictions on multiple products and has extended a cooperation invitation to the United States for joint development of key mineral projects. On Monday, the largest economy in Southeast Asia stated that it will relax or lift import restrictions on ten categories of goods and raw materials, including timber products, pearls, subsidized fertilizers, some fuels and chemicals, plastic raw materials, food trays, bicycles, and footwear. Indonesia's Minister of Economic Affairs, Airlangga Hartarto, who is leading the response to the threat of a 32% tariff from the United States, stated that these measures will help in the tariff negotiations with the U.S. and also push Indonesia towards broader economic and trade goals, including reaching a trade agreement with the European Union and joining the OECD. At the same time, Indonesian officials announced tightened import regulations on clothing and accessories to support the domestic manufacturing industry. Import restrictions on strategic commodities such as rice, salt, fisheries products, goods related to safety and health, and certain labor-intensive products in the textile and steel industries remain unchanged. Earlier, the U.S. Trade Representative's Office had pointed out that Indonesia's cumbersome administrative procedures constituted non-tariff barriers, stating that the "cumulative import license requirements impeded market access." Additionally, as part of the trade negotiations with the U.S., Indonesia has offered the U.S. the opportunity to jointly invest in a significant mineral project. Hartarto added that Indonesia's sovereign wealth fund, Danantara Indonesia, will be involved in the project. Hartarto stated, "We propose an investment cooperation in the electric vehicle industry chain, involving nickel and other key materials," but did not disclose further details. As the world's largest nickel producer (nickel being a core material in electric vehicle batteries), Indonesia has recently accelerated the development of the electric vehicle battery supply chain, officially launching the construction of an industrial park with a total investment of $5.9 billion last Sunday. These policy adjustments come at a time of heightened global trade tensions and increased regional competition in Southeast Asia. Indonesia is trying to position itself as a more attractive international investment destination, although the country's ranking in the latest Global Competitiveness Report by the International Institute for Management Development has dropped by 13 places. The overall relaxation measures also mark one of President Joko Widodo's early initiatives to improve Indonesia's business environment. The president has emphasized the need for Indonesia to streamline administrative processes, enhance competitiveness, accelerate economic growth, and achieve development goals. Hartarto stated that these policy adjustments, which will take effect in the coming months, partly stem from regional competitive pressures and the overall tension in the global trade situation, in line with the president's directive to alleviate economic uncertainty. He added that more relaxation of regulations will be introduced in the future.