Jakarta - The Indonesian Chamber of Commerce and Industry (Kadin Indonesia) has stated that Indonesia holds the potential to increase its export value by up to USD 1.7 billion (approximately IDR 28.6 trillion), provided it can capitalize on the opportunities arising from the ongoing tariff war triggered by U.S. trade policies.

"Broadly speaking, we see several sectors and product areas with significant potential. Among them are textile-based footwear and rubber-based footwear, both of which show substantial growth prospects," said Kadin Indonesia’s Vice Chairman for Membership, Widiyanto Saputro, in Jakarta on Thursday (April 24, 2025).

In his presentation at The 3rd China International Supply Chain Expo Roadshow, Kadin highlighted projected export growth for key products, including:

Textile-based footwear: USD 245 million (IDR 4.1 trillion),

Rubber-based footwear: USD 193 million (IDR 3.25 trillion),

Knitted sweaters: USD 126 million (IDR 2.12 trillion).

Widiyanto explained that the U.S.-China trade war is causing shifts in global supply chains, many of which rely heavily on China—including those that affect Indonesia.

A study by Kadin estimates that Indonesia is positioned to become the second most advantaged country in Southeast Asia, after Vietnam, in terms of benefitting from the ongoing tariff war—provided the situation is handled strategically and effectively.

"In fact, this trade war presents a real opportunity to boost Indonesia’s industrial sector—if managed properly," he added.

To support this, Kadin has outlined three key recommendations for the Indonesian government in navigating the tariff dispute:

Redefine Indonesia’s presence in the global value chain

“We believe that Indonesia will need the support of our counterparts—entrepreneurs and producers in China—to help reshape and develop Indonesia’s industrial landscape in response to the changing global dynamics,” Widiyanto stated.

Reassess global supply chain shifts and identify new export opportunities

The government should reframe how global supply chains are evolving and determine which Indonesian products have the most export potential under the new trade paradigm.

Encourage domestic investment to expand production capacity and increase value-added processing

Strengthening local manufacturing capabilities is crucial to reinforce the “Made in Indonesia” brand and ensure that the country can fully leverage shifts in global supply chains.

"Ultimately, we hope these strategies will enable Indonesia to benefit from the ongoing restructuring of the global supply chain,” he said.

Earlier this month, former U.S. President Donald Trump raised reciprocal tariffs on Chinese goods from 84% to 125%, further escalating trade tensions between Washington and Beijing. The reciprocal tariffs are in addition to a previous 20% levy imposed due to illegal fentanyl-related concerns.

Several imports from China now face even higher tariffs. Certain goods—including electric vehicles and syringes—are now subject to U.S. tariffs as high as 245%.

Source: Antaranews.com