Indonesia's tariff deal may hurt green goals: Analysts

The Indonesia-United States tariff deal comes at a huge cost to Indonesia, as it may prevent the country from attaining its renewable energy goals and pose a threat to its export sector, analysts said.

The tariff deal, announced on Tuesday, reduced US tariffs from 32 percent to 19 percent, with transshipment adding the rate of the source country. Indonesia agreed to import $15 billion in energy products, $4.5 billion in agricultural items and 50 Boeing jets from the US, and eliminate any duty on US goods.

The 19 percent tariff "is still high for us", said Tauhid Ahmad, executive director of the Institute for Development of Economics and Finance in Jakarta, adding that it will discourage Indonesian exporters from shipping to the US. Meanwhile, owing to the duty-free facility offered to US goods, the "export of American products to Indonesia will become more massive".