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Indonesia's chief trade negotiator said on Tuesday that the United States has agreed in principle to exempt Indonesian exports of cocoa, palm oil and rubber from the 19% tariffs imposed by President Donald Trump since 7 August.
He added that the exemption would take effect once a final agreement is reached between the two sides, though no timeline has been set as the United States is currently occupied with tariff talks with other countries, according to Airlangga Hartarto, Coordinating Minister for Economic Affairs, who spoke to Reuters.
The two sides also discussed the possibility of US investment in fuel storage in Indonesia in partnership with Indonesia's sovereign wealth fund Danantara and state energy company Pertamina, Airlangga said in an interview.
"We are awaiting their response, but during the meeting it was agreed in principle to grant exemptions for products not produced in the United States, such as palm oil, cocoa and rubber ... where the tariff would be zero or close to zero," he said.
A spokesperson for the US Embassy in Jakarta did not immediately respond to a request for comment.
Indonesia is the world's largest palm oil exporter and a major supplier of rubber.
Indonesia, the largest economy in the region, was among the first countries to strike a tariff deal with Trump in July, but ultimately ended up facing the same rate applied to other countries such as Thailand and Malaysia, and only slightly lower than the 20% imposed on Vietnam.
During the talks, Indonesia offered billions of dollars in investments in the United States and pledged to purchase American crude oil, liquefied petroleum gas, aircraft and agricultural products. It also promised to impose near-zero tariffs on almost all US goods entering its market.
Airlangga said that certainty over US tariffs, together with recent progress in free trade agreement talks with the European Union, could boost Indonesia's economic growth, helping the government achieve its 5.4% growth target for 2026, up from an estimated near-5% this year.
"It brings an optimistic impression from the global market, where most investors are looking for certainty, and Indonesia is among the countries offering that certainty on a global scale," he added.
Jakarta is seeking to attract foreign investors to help develop industrial facilities, particularly in processing its key commodities, replicating the success it achieved in attracting Chinese investment in nickel projects.
Airlangga added that the government is also keen to boost investment in processing silica sand, including for the production of solar panels and semiconductor chips.
Source: Reuters