The Deputy Minister of Industry recently stated that after the US President announced new import tariffs on some countries, triggering a trade war, China lost its main market in the US, and a large number of products were diverted to other countries, with Indonesia becoming an important destination. This has led to an influx of Chinese products into the Indonesian market, impacting local industries. In June 2025, Indonesia's Manufacturing Purchasing Managers' Index was 46.9, in contraction territory, mainly due to weak new demand in export markets, global market sentiment, and trade policy uncertainty; labor-intensive industries such as textiles and automotive parts, as well as electronics and home appliances, are facing pressure from declining export demand; the conflict between Iran and Israel could disrupt energy supplies, thereby affecting global supply chains. The seven categories of commodities with surging exports from China to Indonesia include: HS 23 (food industry waste and processed feed) up 11.17%, HS 03 (fish and crustaceans) up over 100%, HS 18 (cocoa preparations and processed products) up over 100%, HS 09 (coffee, tea, mate and spices) up 53.42%, HS 48 (paper and paperboard) up 28.52%, HS 19 (cereals, flour, starch, milk and pastry) up 24.91%, HS 44 (wood products and charcoal) up 22.46%. China's agricultural exports to Indonesia surged to US$477,000 (approximately IDR 7.72 billion), up 30%; while during the same period, China's agricultural exports to the US decreased by US$1.17 billion (approximately IDR 18.95 trillion). Indonesia's high dependence on steel and aluminum imports from China is considered a potential structural issue. He emphasized that the government needs to pay attention to the impact of trade diversion on its import structure, formulate protective policies, strengthen local industries, avoid long-term dependence on imports, and at the same time explore the potential of the domestic agricultural industry and address challenges.
The Deputy Minister of Industry recently stated that after the US President announced new import tariffs on some countries, triggering a trade war, China lost its main market in the US, and a large number of products were diverted to other countries, with Indonesia becoming an important destination. This has led to an influx of Chinese products into the Indonesian market, impacting local industries. In June 2025, Indonesia's Manufacturing Purchasing Managers' Index was 46.9, in contraction territory, mainly due to weak new demand in export markets, global market sentiment, and trade policy uncertainty; labor-intensive industries such as textiles and automotive parts, as well as electronics and home appliances, are facing pressure from declining export demand; the conflict between Iran and Israel could disrupt energy supplies, thereby affecting global supply chains. The seven categories of commodities with surging exports from China to Indonesia include: HS 23 (food industry waste and processed feed) up 11.17%, HS 03 (fish and crustaceans) up over 100%, HS 18 (cocoa preparations and processed products) up over 100%, HS 09 (coffee, tea, mate and spices) up 53.42%, HS 48 (paper and paperboard) up 28.52%, HS 19 (cereals, flour, starch, milk and pastry) up 24.91%, HS 44 (wood products and charcoal) up 22.46%. China's agricultural exports to Indonesia surged to US$477,000 (approximately IDR 7.72 billion), up 30%; while during the same period, China's agricultural exports to the US decreased by US$1.17 billion (approximately IDR 18.95 trillion). Indonesia's high dependence on steel and aluminum imports from China is considered a potential structural issue. He emphasized that the government needs to pay attention to the impact of trade diversion on its import structure, formulate protective policies, strengthen local industries, avoid long-term dependence on imports, and at the same time explore the potential of the domestic agricultural industry and address challenges.