On April 30, 2025, Presidential Regulation No. 46 of 2025, concerning the government procurement of goods and services was signed and took effect immediately. This regulation, amending Presidential Regulation No. 16 of 2018, introduced a new clause permitting procurement with a minimum of 25% Local Content Requirements (TKDN) in cases where no domestic products available to meet the combined 40% TKDN threshold and Company Benefit Weight (BMP) score. The TKDN certification process is also shortened from three months to just ten days.
This policy relaxation is a part of the proposed offer of Coordinating Minister for Economic Affairs, Airlangga Hartarto, during the first round of negotiations with U.S counterparts in Washington D.C, on 16-23 April 2025. In addition, also announced is the commitment to increase U.S. imports by up to $19 billion and the establishment of three specialized task forces, namely:
- Trade, Investment, and Economic Security Negotiation Task Force leads negotiation with the U.S., led by the Coordinating Minister for Economic Affairs in collaboration with the Ministry of Foreign Affairs and Ministry of Trade.
- Job Expansion and Layoff Mitigation Task Force focuses to support job retention and creation, led by the Ministry of Manpower in collaboration with the industry associations and the Indonesian labor unions.
- Deregulation Task Force is mandated to ease trade and investment regulatory barriers, in coordination with the Ministry of Industry, Ministry of Finance, and relevant agencies.
The accompanying strategies and the establishment of these task forces underscore Indonesia’s efforts to reduce the 32% reciprocal U.S. tariff, as well as to enhance its competitiveness through trade deficit reduction, addressing non-tariff measures, and improved ease of doing business.
