Indonesia Must Match Malaysia’s Zero-Tariff Palm Oil Deal with US, Analyst Says

as a model for Indonesia. “Looking at the palm oil issue, Malaysia can get a zero percent tariff, meaning Indonesia should leverage its bargaining power more effectively,” Bhima said on Friday. Earlier this week, Malaysian Prime Minister Anwar Ibrahim and US President Donald Trump signed a trade pact that maintained a 19 percent general tariff rate on Malaysian goods but granted zero tariffs for key commodities such as palm oil, cocoa, and rubber, all of which are also Indonesia’s main export products to the US. According to data from the Central Statistics Agency (BPS), Indonesia exported 1.39 million tons of palm oil to the US in 2024, making it the country’s fourth-largest export destination after India, Pakistan, and China. However, Bhima said the US market for Indonesian palm oil remains relatively small. “This means even if tariffs on palm oil are reduced, the benefit to Indonesia will not be significant,” he explained. He suggested that Indonesia broaden its reciprocal ...