April 11, 2025 • 9 mins
In this episode, Michelle delves into recent economic developments affecting Southeast Asia, with a focus on Indonesia. She begins with an introduction and overview of top stories, setting the context for a detailed examination of the impact of US tariffs on Indonesia and the strategies being employed to mitigate their effects. The discussion then shifts to the UAE-Indonesia agreements, highlighting the strategic relationship and economic opportunities they present. Michelle also explores the revitalization of the Indonesia-US Trade and Investment Framework Agreement (TIFA), emphasizing its strategic importance for enhancing bilateral trade. The episode concludes with insights into these dynamic regional economic shifts.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Welcome back to the Southeast Asia MarketsDaily Brief.
(00:02):
I’m your host, AI Michelle.
Here are our top stories today...
First, United States tariffs may cutIndonesia's growth by up to zero point five
percentage points.
Second, the United Arab Emirates and Indonesiahave forged new agreements in the economy,
investment, and renewable energy sectors.
(00:26):
Third, the Trade and Investment FrameworkAgreement revitalization could expand
Indonesia-United States trade, according to thedeputy minister.
Let's delve deeper into our first story.
The imposition of tariffs by the United Statesis anticipated to have a significant impact on
Indonesia's economic growth, potentiallyreducing it by as much as zero point five
(00:48):
percentage points.
These tariffs are part of a broader tradestrategy by the United States that aims to
protect its domestic markets but mightinadvertently affect global trade dynamics,
particularly in Southeast Asia.
Indonesia, as the largest economy in SoutheastAsia, relies heavily on its trade
(01:08):
relationships, with the United States being oneof its key partners.
The tariffs could lead to increased costs forIndonesian exporters, making their goods less
competitive in the United States market.
This scenario may result in a slowdown inexport growth, which is a crucial driver of
Indonesia's overall economic performance.
(01:30):
Moreover, sectors such as textiles,electronics, and palm oil, which are vital to
Indonesia's export economy, could bedisproportionately affected.
The textile industry, in particular, has been amajor contributor to employment and foreign
exchange earnings for Indonesia.
Any contraction in this sector could haveripple effects across the Indonesian economy,
(01:53):
affecting everything from job creation to thecountry's fiscal health.
The Indonesian government is likely to explorevarious strategies to mitigate these impacts,
such as seeking new markets, enhancing domesticconsumption, and investing in value-added
production.
Additionally, the situation underscores theimportance of Indonesia diversifying its trade
(02:15):
partnerships to reduce dependency on any singlemarket.
This could involve strengthening ties withinSoutheast Asia and exploring new opportunities
in other emerging regions.
As we continue to monitor these developments,the situation highlights the delicate balance
countries must maintain in navigatinginternational trade policies.
(02:37):
The outcome of these tariffs will not onlyshape Indonesia's economic landscape but could
also influence broader regional economic trendsin Southeast Asia.
The United Arab Emirates and Indonesia havetaken a significant step forward in
strengthening their bilateral relations byforging new agreements across several key
(02:57):
sectors.
These agreements were the result of a meetingbetween UAE President His Highness Sheikh
Mohamed bin Zayed Al Nahyan and IndonesianPresident Prabowo Subianto in Abu Dhabi.
The leaders explored a wide range ofopportunities to enhance cooperation in areas
such as the economy, investment, renewableenergy, sustainability, and infrastructure.
(03:21):
This dialogue is crucial for promoting growthand mutual benefit between the two nations.
During President Subianto’s visit, the twoleaders announced several agreements and
memoranda of understanding that span varioussectors, including the economy, investment,
environment, food security, renewable energy,and sustainability.
(03:43):
This comprehensive approach to partnershipensures that both nations can work together to
address common challenges and achieve shareddevelopment goals.
Additionally, agreements were established forcooperation in the fields of security and
Islamic affairs, highlighting the holisticnature of this bilateral partnership.
(04:04):
The discussions took place within the frameworkof a strategic relationship and comprehensive
economic partnership between the UAE andIndonesia.
This robust foundation is expected to pave theway for increased collaboration and innovation,
supporting the shared development ambitions ofboth countries.
The leaders also reviewed several regional andinternational developments of mutual interest,
(04:28):
reaffirming their countries’ commitment tosupporting peace and stability through dialogue
and diplomatic means.
This commitment is essential for fosteringdevelopment and prosperity on a global scale.
The meeting was attended by prominent figuresfrom both nations, including His Highness
Sheikh Mansour bin Zayed Al Nahyan, VicePresident and Deputy Prime Minister of the UAE,
(04:51):
as well as key ministers and advisors.
The presence of these high-ranking officialsunderscores the importance both countries place
on advancing their relationship.
The UAE and Indonesia have consistentlydemonstrated their dedication to mutual growth,
with their relations witnessing significantprogress over the years for the benefit of the
(05:11):
peoples of both nations.
The agreements and discussions highlightedduring this meeting reflect a shared vision for
the future, where collaboration across varioussectors can lead to sustainable economic
growth.
The focus on renewable energy andsustainability is particularly noteworthy, as
both countries aim to develop strategies thatalign with global efforts to address climate
(05:35):
change and environmental challenges.
By investing in these areas, the UAE andIndonesia are not only enhancing their
bilateral ties but also contributing to broaderglobal sustainability goals.
Now, let's turn our attention to therevitalization of the Trade and Investment
Framework Agreement, or TIFA, between Indonesiaand the United States.
(06:01):
This development could be a pivotal step inexpanding bilateral trade between the two
nations.
Deputy Minister of Trade, Dyah Roro Esti WidyaPutri, emphasized this potential during the
"Public Forum (06:14):
Regional Response to Trump 2.0" event.
She highlighted that the revitalization of TIFAis expected to serve as a platform for
exploring new avenues of collaboration, therebybroadening the trade relationship.
The original TIFA was implemented back in 1996,and the Indonesian government is keen on
(06:37):
updating the agreement to better reflectcurrent and future trade dynamics.
This renewal will include new policies, aimingto align with the evolving global trade
landscape.
The deputy minister mentioned that severalworking groups are involved in this process,
particularly those focused on services,intellectual property rights, investment,
(06:57):
agriculture, and industry.
The revitalization of TIFA comes at a criticaltime, especially in light of recent United
States tariff policies.
On April second, President Trump announcedreciprocal tariffs on several countries,
including Indonesia, which faces a thirty-twopercent tariff.
(07:19):
Other Southeast Asian nations have also beenimpacted, with varying tariff rates imposed by
the United States.
This move has prompted Indonesia to seek waysto mitigate the potential negative impacts on
its economy.
The Indonesian government sees the TIFArevitalization as a strategic response to these
tariffs.
(07:39):
By renegotiating and updating the agreement,Indonesia aims to strengthen its trade ties
with the United States, potentially offsettingsome of the adverse effects of the tariffs.
This effort underscores Indonesia's proactiveapproach to navigating the complexities of
international trade amidst shifting policies.
(08:00):
Furthermore, the revitalization of TIFA couldopen doors to new investment opportunities and
enhance cooperation in key sectors.
This aligns with Indonesia's broader economicstrategy of diversifying its trade partnerships
and reducing dependency on any single market.
By fostering a more collaborative tradeenvironment with the United States, Indonesia
(08:23):
hopes to not only bolster its own economy butalso contribute positively to the regional
economic landscape.
As we continue to follow these developments,it's clear that the revitalization of TIFA
holds significant promise for both Indonesiaand the United States.
It represents a chance to reshape andstrengthen their economic partnership in a way
(08:47):
that reflects the realities of today's globalmarket.
Alright, that's a wrap for this episode.
If you enjoyed this brief, and would like tostay updated on latest episodes, don’t forget
to click ‘Follow’ in your podcast app.
Thanks again for listening, and hope to catchyou next time.
Welcome back to the Southeast Asia MarketsDaily Brief.
(00:02):
I’m your host, AI Michelle.
Here are our top stories today...
First, United States tariffs may cutIndonesia's growth by up to zero point five
percentage points.
Second, the United Arab Emirates and Indonesiahave forged new agreements in the economy,
investment, and renewable energy sectors.
(00:26):
Third, the Trade and Investment FrameworkAgreement revitalization could expand
Indonesia-United States trade, according to thedeputy minister.
Let's delve deeper into our first story.
The imposition of tariffs by the United Statesis anticipated to have a significant impact on
Indonesia's economic growth, potentiallyreducing it by as much as zero point five
(00:48):
percentage points.
These tariffs are part of a broader tradestrategy by the United States that aims to
protect its domestic markets but mightinadvertently affect global trade dynamics,
particularly in Southeast Asia.
Indonesia, as the largest economy in SoutheastAsia, relies heavily on its trade
(01:08):
relationships, with the United States being oneof its key partners.
The tariffs could lead to increased costs forIndonesian exporters, making their goods less
competitive in the United States market.
This scenario may result in a slowdown inexport growth, which is a crucial driver of
Indonesia's overall economic performance.
(01:30):
Moreover, sectors such as textiles,electronics, and palm oil, which are vital to
Indonesia's export economy, could bedisproportionately affected.
The textile industry, in particular, has been amajor contributor to employment and foreign
exchange earnings for Indonesia.
Any contraction in this sector could haveripple effects across the Indonesian economy,
(01:53):
affecting everything from job creation to thecountry's fiscal health.
The Indonesian government is likely to explorevarious strategies to mitigate these impacts,
such as seeking new markets, enhancing domesticconsumption, and investing in value-added
production.
Additionally, the situation underscores theimportance of Indonesia diversifying its trade
(02:15):
partnerships to reduce dependency on any singlemarket.
This could involve strengthening ties withinSoutheast Asia and exploring new opportunities
in other emerging regions.
As we continue to monitor these developments,the situation highlights the delicate balance
countries must maintain in navigatinginternational trade policies.
(02:37):
The outcome of these tariffs will not onlyshape Indonesia's economic landscape but could
also influence broader regional economic trendsin Southeast Asia.
The United Arab Emirates and Indonesia havetaken a significant step forward in
strengthening their bilateral relations byforging new agreements across several key
(02:57):
sectors.
These agreements were the result of a meetingbetween UAE President His Highness Sheikh
Mohamed bin Zayed Al Nahyan and IndonesianPresident Prabowo Subianto in Abu Dhabi.
The leaders explored a wide range ofopportunities to enhance cooperation in areas
such as the economy, investment, renewableenergy, sustainability, and infrastructure.
(03:21):
This dialogue is crucial for promoting growthand mutual benefit between the two nations.
During President Subianto’s visit, the twoleaders announced several agreements and
memoranda of understanding that span varioussectors, including the economy, investment,
environment, food security, renewable energy,and sustainability.
(03:43):
This comprehensive approach to partnershipensures that both nations can work together to
address common challenges and achieve shareddevelopment goals.
Additionally, agreements were established forcooperation in the fields of security and
Islamic affairs, highlighting the holisticnature of this bilateral partnership.
(04:04):
The discussions took place within the frameworkof a strategic relationship and comprehensive
economic partnership between the UAE andIndonesia.
This robust foundation is expected to pave theway for increased collaboration and innovation,
supporting the shared development ambitions ofboth countries.
The leaders also reviewed several regional andinternational developments of mutual interest,
(04:28):
reaffirming their countries’ commitment tosupporting peace and stability through dialogue
and diplomatic means.
This commitment is essential for fosteringdevelopment and prosperity on a global scale.
The meeting was attended by prominent figuresfrom both nations, including His Highness
Sheikh Mansour bin Zayed Al Nahyan, VicePresident and Deputy Prime Minister of the UAE,
(04:51):
as well as key ministers and advisors.
The presence of these high-ranking officialsunderscores the importance both countries place
on advancing their relationship.
The UAE and Indonesia have consistentlydemonstrated their dedication to mutual growth,
with their relations witnessing significantprogress over the years for the benefit of the
(05:11):
peoples of both nations.
The agreements and discussions highlightedduring this meeting reflect a shared vision for
the future, where collaboration across varioussectors can lead to sustainable economic
growth.
The focus on renewable energy andsustainability is particularly noteworthy, as
both countries aim to develop strategies thatalign with global efforts to address climate
(05:35):
change and environmental challenges.
By investing in these areas, the UAE andIndonesia are not only enhancing their
bilateral ties but also contributing to broaderglobal sustainability goals.
Now, let's turn our attention to therevitalization of the Trade and Investment
Framework Agreement, or TIFA, between Indonesiaand the United States.
(06:01):
This development could be a pivotal step inexpanding bilateral trade between the two
nations.
Deputy Minister of Trade, Dyah Roro Esti WidyaPutri, emphasized this potential during the
"Public Forum (06:14):
Regional Response to Trump 2.0" event.
She highlighted that the revitalization of TIFAis expected to serve as a platform for
exploring new avenues of collaboration, therebybroadening the trade relationship.
The original TIFA was implemented back in 1996,and the Indonesian government is keen on
(06:37):
updating the agreement to better reflectcurrent and future trade dynamics.
This renewal will include new policies, aimingto align with the evolving global trade
landscape.
The deputy minister mentioned that severalworking groups are involved in this process,
particularly those focused on services,intellectual property rights, investment,
(06:57):
agriculture, and industry.
The revitalization of TIFA comes at a criticaltime, especially in light of recent United
States tariff policies.
On April second, President Trump announcedreciprocal tariffs on several countries,
including Indonesia, which faces a thirty-twopercent tariff.
(07:19):
Other Southeast Asian nations have also beenimpacted, with varying tariff rates imposed by
the United States.
This move has prompted Indonesia to seek waysto mitigate the potential negative impacts on
its economy.
The Indonesian government sees the TIFArevitalization as a strategic response to these
tariffs.
(07:39):
By renegotiating and updating the agreement,Indonesia aims to strengthen its trade ties
with the United States, potentially offsettingsome of the adverse effects of the tariffs.
This effort underscores Indonesia's proactiveapproach to navigating the complexities of
international trade amidst shifting policies.
(08:00):
Furthermore, the revitalization of TIFA couldopen doors to new investment opportunities and
enhance cooperation in key sectors.
This aligns with Indonesia's broader economicstrategy of diversifying its trade partnerships
and reducing dependency on any single market.
By fostering a more collaborative tradeenvironment with the United States, Indonesia
(08:23):
hopes to not only bolster its own economy butalso contribute positively to the regional
economic landscape.
As we continue to follow these developments,it's clear that the revitalization of TIFA
holds significant promise for both Indonesiaand the United States.
It represents a chance to reshape andstrengthen their economic partnership in a way
(08:47):
that reflects the realities of today's globalmarket.
Alright, that's a wrap for this episode.
If you enjoyed this brief, and would like tostay updated on latest episodes, don’t forget
to click ‘Follow’ in your podcast app.
Thanks again for listening, and hope to catchyou next time.
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