In the land of Konoha, where the sun shines bright but accountability remains in shadow, the officials have mastered the art of deflection. When citizens rallied behind the hashtag #Konohagelap to highlight systemic failures, the officials—ever literal in their wisdom—responded, "You’re the ones who are dark!" as if societal critique was a mere lighting issue. The saga continued with #Kaburajadulu, a cry for escape from oppressive governance. Instead of introspection, these dignitaries channeled their inner disgruntled parents: "Don’t bother coming back!"—a statement so rich in irony it could fund their next campaign.
And when #ogahbayarpajak emerged as a protest against rampant corruption, they didn’t address the rot within. No, they threatened to deny services to taxpayers, essentially saying, "Pay us to rob you—or else!"
It seems the noble mantra "Bekerja untuk rakyat (Working for the people)" has been drowned in a sea of nepotism and political favors. In Konoha, it’s not about serving the people; it’s about serving your relatives and cronies. Truly, a democracy by friends and for friends.
Thus, the people of Konoha began flooding the world with memes, poking fun at their beloved officials. It was as if they were channeling the same energy as audiences mocking the Evil Queen in Snow White 2025. According to IMDb, she wasn’t just bad at playing the Evil Queen—she was hilariously bad! Picture a kid in a school play trying to embody a Disney villain: her performance swung wildly between over-the-top dramatics and bafflingly wooden expressions. Miscasting concerns? Check. Accent criticism? Double-check. Pre-release judgments? Oh, absolutely. And just like that, the citizens of Konoha rated their officials with the same biting critique. Much like the Evil Queen’s portrayal, which turned out to be the star’s ultimate career nightmare after delivering her most disastrous role yet in Snow White.
In their relentless quest to blame the very citizens they serve, the officials of Konoha are blissfully unaware that danger is lurking just around the corner, probably waiting for an invitation to join the party!
In a plot twist straight out of a dystopian comedy, President Donald Trump has slapped Indonesia with a 32% tariff on its exports to the United States. The move, part of his latest "Liberation Day" campaign, aims to "reclaim America's destiny" while leaving Indonesia scratching its head and possibly its pockets.
Indonesia now joins the elite club of heavily tariffed nations, sitting just two points below China (34%) and tied with Taiwan. It's like being invited to an exclusive party where the dress code is economic pain. ASEAN buddies Vietnam and Thailand didn’t fare much better, with tariffs of 46% and 37%, respectively. Meanwhile, Malaysia got off relatively lightly at 24%, probably because someone in Washington forgot where it is on the map.
According to Trump’s logic—if that’s what we’re calling it—these tariffs are merely "reciprocal." He claims Indonesia imposes a 64% tariff on U.S. goods, though no one seems to know where he got that number. Perhaps it was written on the back of a napkin during one of his infamous golf trips. Regardless, Trump insists this is all about fairness, which is ironic given that fairness now feels like a distant memory for Indonesian exporters.
The Indonesian rupiah has already started its descent faster than a plane with no fuel, and exporters are bracing for impact. Industries like textiles and footwear are expected to take the hardest hit, as their products will now cost more in the U.S. than a designer handbag. Layoffs are looming, and workers are wondering if they should start learning how to make TikTok videos instead.
What does Trump want?
Trump's reciprocal tariff policy is designed to achieve significant political and economic gains for the United States. Politically, it seeks to bolster nationalist sentiments and provide leverage in trade negotiations while economically aiming to stimulate domestic manufacturing and increase government revenue.
The reciprocal tariff policy implemented by President Trump is expected to yield both political and economic benefits for the United States. By imposing tariffs, Trump aims to appeal to nationalist sentiments among American voters who feel that foreign competition undermines domestic industries. This move is framed as a way to protect American jobs and promote "America First" policies, reinforcing his political base.
The tariffs are presented as a solution to the persistent trade deficit the U.S. faces with many countries, including Indonesia. By claiming that these tariffs will help rectify trade imbalances, Trump can position himself as a leader taking decisive action to improve the economic standing of the U.S.
The tariffs can be used as leverage in negotiations with other countries. By demonstrating a willingness to impose tariffs, the U.S. may push trading partners to make concessions or engage in more favorable trade agreements.
Industries that are likely to benefit from reduced foreign competition (e.g., manufacturing, textiles) may support Trump’s policies, providing him with political backing from influential business sectors.
That was the political benefits. What are the economic benefits?
The primary economic goal of the tariffs is to stimulate growth in American manufacturing by making imported goods more expensive. This could lead to increased production within the U.S., potentially creating jobs and boosting local economies.
Tariffs are expected to generate substantial revenue for the U.S. government. Estimates suggest that these measures could increase tax revenues by up to $600 billion annually, providing funds that could be used for various domestic programs or deficit reduction.
As tariffs raise the cost of imports, businesses may be incentivized to invest in domestic production capabilities rather than relying on foreign suppliers. This could lead to long-term growth in key sectors of the economy.
The tariffs are also aimed at addressing non-tariff barriers that American exporters face in countries like Indonesia, such as licensing requirements and local content regulations. By tackling these issues, Trump hopes to level the playing field for American businesses.
However, these policies also carry risks, including potential retaliation from trading partners and negative impacts on consumers due to higher prices for imported goods. Reactions from various countries to President Trump's reciprocal tariff policy have been mixed, with some nations expressing strong opposition while others are taking a more cautious approach.
The Chinese Ministry of Commerce has strongly opposed the new tariffs, stating that they will take retaliatory measures to protect their rights and interests. They emphasized that there are no winners in a trade war and called for dialogue to resolve differences.
Japanese officials, including Prime Minister Shigeru Ishiba, have expressed disappointment over the tariffs, describing them as regrettable and potentially violating trade agreements. Japan is considering a strong and swift response to these unilateral measures.
Canadian Prime Minister Mark Carney vowed to fight back against the tariffs with countermeasures, emphasizing the importance of protecting Canadian workers and industries.
The EU is preparing a package of retaliatory measures against the new tariffs, with officials stating they will not remain passive if negotiations fail. President Ursula von der Leyen highlighted the need for a united front.
Australian Prime Minister Anthony Albanese criticized the tariffs as lacking logic and being detrimental to economic partnerships. He stated that Australia would negotiate with the U.S. rather than impose retaliatory tariffs, which could raise costs for households.
Vietnamese Prime Minister Pham Minh Chinh held emergency meetings to discuss both short-term and long-term strategies in response to the 46% tariff imposed on Vietnamese exports.
The Brazilian government expressed regret over Trump's decision and is evaluating potential actions to ensure balance in bilateral trade, including possibly bringing the issue to the World Trade Organization (WTO).
German officials have stressed the importance of a unified EU response to U.S. tariffs, emphasizing that European strength lies in its single market.
Israel announced plans to eliminate remaining import duties on U.S. products in response to the new tariffs imposed on them.
UK Prime Minister Keir Starmer indicated that while they would remain calm and pragmatic, they have various tools at their disposal should they need to respond.
Meanwhile, the esteemed officials of Konoha remain silent on pressing matters, they are reportedly engrossed in unraveling the profound mysteries of the T-Rex's familial ties to the humble chicken, all while devising groundbreaking strategies to transform Mulyono's humble abode into the next global tourism hotspot. Long live Mulyono!! Aaaoooowhhh!!!
Experts suggest Indonesia might pivot to other markets, but let’s be honest—finding new trade partners isn’t as easy as swiping right on Tinder. Meanwhile, production costs will rise, growth will slow, and the economy might end up resembling a poorly made nasi goreng: unbalanced and hard to digest.
The imposition of reciprocal tariffs by the U.S. on Indonesian imports significantly affects the elasticity of demand for these goods. Let's see the analysis of the elasticity of demand for Indonesian Imports in the U.S. Market.
Price Elasticity in general: The demand for Indonesian imports in the U.S. tends to be elastic for many manufactured goods and semi-manufactured commodities, meaning that price increases due to tariffs lead to a proportionately larger decline in demand. For example, textiles and electronics face direct competition from other countries like Vietnam and India, making them highly sensitive to price changes.
Substitution Effects: Positive cross-price elasticity is evident in commodities like shrimp. For instance, a 1% increase in the price of Indonesian shrimp leads to a 1.307% increase in demand for Indian shrimp, indicating strong substitution effects
. Similarly, Mexican and Vietnamese shrimp also benefit from price hikes on Indonesian shrimp (cross-elasticities of 0.761 and 0.384, respectively).
How about the Income Elasticity? Inelastic Goods: Commodities such as frozen shrimp from Indonesia have an income elasticity of 0.582, indicating they are considered normal goods in the U.S.
A 1% increase in U.S. consumer spending raises demand for Indonesian shrimp by only 0.582%, showing limited responsiveness to income changes.
Elastic Goods: In contrast, shrimp from India and Mexico are treated as luxury goods with income elasticities of 1.508 and 1.454, respectively. This suggests that as U.S. incomes rise, consumers prefer higher-value imports from these countries over Indonesia.
Demand adjustments to tariff-induced price changes are not instantaneous; they follow a dynamic pattern over several years. While short-term demand may drop sharply due to higher prices, long-term adjustments depend on factors like alternative sourcing and consumer preferences stabilizing.
Manufactured exports from Indonesia generally exhibit higher long-run income elasticities (e.g., 2.62), implying that wealthier American consumers may eventually return to purchasing these goods despite initial price sensitivity.
High tariffs encourage American consumers to shift toward imports from competing countries with lower prices or better perceived quality. This is particularly problematic for commodities like seafood and textiles, where Indonesia faces stiff competition. To mitigate such effects, Indonesia could focus on enhancing product uniqueness (e.g., branding premium goods like kopi luwak) or improving production efficiency to reduce costs.
The elasticity of demand for Indonesian imports in the U.S. market varies significantly across product categories. Price-sensitive goods like textiles and seafood experience sharp declines in demand due to substitution effects. Normal goods such as frozen shrimp show limited responsiveness to income changes but remain vulnerable to competitive pressures. Long-term recovery depends on strategic adjustments by exporters and government policies aimed at maintaining competitiveness.
In summary, reciprocal tariffs amplify consumer sensitivity to price changes, forcing Indonesia to rethink its export strategy amidst a highly elastic market environment dominated by fierce global competition.
Which sectors and what will fall first in Indonesia due to the impact of this reciprocal tariff?
Indonesia faces significant challenges in countering the impact of the U.S. reciprocal tariffs, particularly the 32% tariff imposed by President Trump. This policy is expected to have immediate and profound effects on various sectors of the Indonesian economy.
The textile and apparel industry is one of the most vulnerable sectors. With a high reliance on exports to the U.S., these products will become significantly more expensive for American consumers, likely leading to a sharp decline in demand. This sector has historically been a major contributor to Indonesia's export revenue, and a decrease in orders could result in job losses and factory closures.
Similar to textiles, the electronics sector is poised for a downturn. The increased costs due to tariffs may push U.S. buyers toward cheaper alternatives from other countries, diminishing Indonesia's market share. The electronics industry has seen robust growth in recent years, and this sudden shift could reverse that trend.
The automotive sector is also at risk, particularly as exports of automotive products to the U.S. have been growing steadily. With tariffs making these products less competitive, manufacturers may face reduced sales and potential layoffs, disrupting a sector that has been crucial for economic growth.
Key agricultural exports such as palm oil, rubber, and seafood are likely to see reduced demand as well. The higher prices resulting from tariffs may lead U.S. consumers to seek alternatives from other countries with lower tariffs or no tariffs at all.
Indonesia is known for its furniture exports, which could also suffer under the weight of these tariffs. As American consumers look for cost-effective options, demand for Indonesian furniture may decline sharply.
The imposition of these tariffs could lead to "trade diversion," where U.S. importers switch their sourcing from Indonesia to countries that are not subject to such high tariffs, further exacerbating the decline in Indonesian exports. Economists predict that if these trends continue, Indonesia could face a recession by late 2025 due to the compounded effects on export revenues and employment across these sectors. It is like a bad sequel to a movie nobody wanted to see again. The immediate effects are as delightful as a flat tire on a rainy day, with economists warning of significant ramifications for Indonesia's economy.
What are the Short-term Impacts?
Export Decline. Expect a dramatic plunge in exports to the U.S., particularly in textiles, footwear, electronics, and agricultural products. It's as if Trump decided to throw a party and forgot to invite Indonesia, leaving them with all the snacks and no guests.
Job Losses. The specter of mass layoffs looms large. With industries heavily reliant on exports facing increased costs, workers might find themselves in the unemployment line faster than you can say "trade war"—a situation that could turn into a sobering reality for many families.
Currency Fluctuations. The Indonesian rupiah is likely to take a nosedive, with predictions suggesting it could plummet past 17,000 IDR per USD. This depreciation will make everything from imported goods to your favorite avocado toast more expensive.
What are the Long-term consequences?
If the tariff situation continues unchecked, Indonesia could find itself teetering on the edge of recession by late 2025. The ripple effects of reduced exports could lead to stagnation in growth, akin to watching paint dry but less exciting.
In the grand scheme of things, trade diversion may occur as Indonesia shifts its focus to other markets. However, this is like trying to find a new favorite song after your playlist gets ruined; it might not be as easy or satisfying
As exporters grapple with higher tariffs, production costs will inevitably rise, leading to slower manufacturing outputs. This scenario is reminiscent of trying to run a marathon while carrying an extra backpack—it's just not sustainable
In summary, while Trump may think he's playing a clever game of economic chess, the reality for Indonesia is more like a game of Jenga where one wrong move could lead to a catastrophic collapse. The need for negotiation and strategic planning is more pressing than ever if Indonesia hopes to mitigate these impending challenges.
In conclusion, while Indonesia has mechanisms to adapt and respond, the immediate future appears challenging as key sectors brace for significant disruptions due to U.S. tariff policies. The focus will need to be on strategic negotiations and finding new markets while supporting affected industries domestically.
Spoiler: Hopefully, President Prabowo will not send any buzzers who pretend to be Indonesian officials.
Trump celebrated this move as a win for American workers, dubbing it "common sense." For Indonesia, however, it feels more like common nonsense. If this is liberation for America, what’s next? Colonization for everyone else?
Stay tuned as Indonesia figures out whether to negotiate, retaliate, or just send Trump a strongly worded letter (written in Bahasa Indonesia for maximum confusion).
