The Indonesian Employers Association (Apindo) sees the easing of trade tensions between China and the United States as having at least two major implications for Indonesia's economy.

Apindo Chairwoman Shinta W. Kamdani cited that the first impact is the recovery of trade flows between the two economic giants.

“This could potentially boost global demand, improve risk perception toward emerging markets, and help stabilize commodity prices,” she said as quoted by Katadata.co.id on Wednesday, May 14, 2025.

The second impact, according to Shinta, is the resurgence of Chinese products' competitiveness in both the U.S. and global markets − including regions that are also key export destinations for Indonesian goods.

“This could increase competitive pressure on Indonesian products, especially those in the same market segments,” she said.

Shinta added that Indonesia hopes the recent reduction in global trade tensions, which had long created uncertainty and strain on global supply chains, will continue. Apindo, she said, will closely monitor developments in trade negotiations, including the latest U.S.-China agreement, which involves a significant 90-day mutual tariff reduction.

In response to the shifting global trade landscape, Shinta emphasized that Indonesia needs to act swiftly with a series of strategic measures.

First, she suggested accelerating the diversification of export markets and products to reduce dependency on specific countries.

Second, she urged a fast-tracked structural reform in the industrial sector to boost national productivity and efficiency.

Third, she called for stronger trade diplomacy, including maximizing existing trade agreements and finalizing those still under negotiation.

Regarding Indonesia's ongoing trade talks with the U.S., Shinta acknowledged that the process is a government-to-government (G2G) matter and is progressing according to a mutually agreed timeline. Apindo, she noted, respects the government's negotiation strategy and final decisions.

“The business community has played its part by identifying concrete opportunities and providing feedback based on conditions on the ground,” Shinta said.

She further noted that Apindo and the broader private sector are now focused on addressing domestic structural issues, particularly deregulation − a longstanding barrier to doing business in the country.

“This is not only a concern for the U.S. or other trading partners, but is most critically felt by local businesses themselves,” she emphasized.

To that end, she reiterated Apindo's call for accelerated regulatory and bureaucratic reform. She also expressed hope that the proposed Deregulation Task Force − previously discussed − could begin operations soon and actively involve the business community.