Toyota Highlights Indirect Impact of US-China Tariff War on Indonesia

KatadataOTO – United States President, Donald Trump, has implemented import tariffs on a number of countries that export their vehicles to the US. One of them is China.

It didn't stop there, China then also retaliated by implementing additional import tariffs on US products entering China.

Indonesia is not an exporter of four-wheeled vehicles to the United States. However, there is still an indirect impact that the automotive industry can feel if the tariff war continues.

Exports of four-wheeled vehicles, according to Toyota Indonesia, will be disrupted by the impact of the US-China tariff war. 

Photo : Toyota

“Vietnam, Thailand, Mexico and others, those countries will be greatly affected by Trump's policies,” said Nandi Julyanto, President Director of PT TMMIN (Toyota Motor Manufacturing Indonesia) in Central Jakarta, Wednesday (14/05).

The economic decline of these countries will be followed by a decrease in purchasing power, and will impact exports from Indonesia to them.

As for the impact on the domestic market, Toyota highlights the potential for a flood of Chinese products into various global countries other than the US, including Indonesia.

“It will certainly affect the Indonesian market with the entry of Chinese goods that are relatively cheap. However, it all comes back to which one the consumers want to choose,” he said.

Amid these various challenges, Toyota believes there are still opportunities that can be utilized. It just requires the government's role in realizing them.

“We can find new (export) destinations, trade agreements with destination countries, we can do that with the government's help,” he asserted.

He revealed that his party has discussed with related parties to help so that the potential of FTAs (Free Trade Agreements) with various destination countries can be implemented.

Photo : Toyota

For your information, the US is currently lowering the Import Duty (BMI) on Chinese products exported to America, from 145 percent to 30 percent for the time being.

A similar thing was done in reverse by China. The BMI on US products to China was reduced from 125 percent to 10 percent. The agreement is valid for the next three months.

Undeniably, this uncertainty has made many automotive industry manufacturers more cautious in taking steps forward.