Does the Us Have a Free Trade Agreement with Indonesia

As a professional, I understand the importance of addressing commonly searched questions in my writing. One such question is, “does the US have a free trade agreement with Indonesia?” In this article, I will answer that question and provide some context on the relationship between the US and Indonesia.

Firstly, let`s define what a free trade agreement (FTA) is. An FTA is a treaty between two or more countries that aims to reduce or eliminate trade barriers, such as tariffs and quotas, on goods and services traded between them. FTAs can also establish rules and regulations related to intellectual property, labor, and environmental standards.

With that in mind, the US does not currently have an FTA with Indonesia. However, the two countries have been working towards closer economic ties. In 2013, they launched the US-Indonesia Comprehensive Partnership, a framework for expanding bilateral cooperation in various areas, including trade and investment. The Partnership includes a Trade and Investment Framework Agreement (TIFA), which serves as a platform for addressing trade issues and exploring ways to enhance economic ties between the two countries.

One major obstacle to an FTA between the US and Indonesia is the latter`s protectionist policies. Indonesia maintains high tariffs and non-tariff barriers on a range of products, including agricultural goods, which makes it difficult for US companies to export to the country. Additionally, Indonesia is not a member of the Trans-Pacific Partnership (TPP), a comprehensive trade deal that the US was negotiating with several other countries, including Japan, Canada, and Australia, before withdrawing in 2017.

Despite these challenges, the US-Indonesia economic relationship is still strong. The US is one of Indonesia`s largest trading partners, with bilateral trade reaching $28.6 billion in 2019. The US is also one of the biggest investors in Indonesia, with US companies investing over $15 billion in the country in 2019.

In conclusion, while the US and Indonesia do not have an FTA, they are still working towards closer economic ties and have established a framework for cooperation through the Comprehensive Partnership. The US-Indonesia economic relationship is still strong, despite some challenges that need to be addressed. As the two countries continue to engage with each other, it is possible that an FTA may be on the horizon.