Summary: This study examines the multifaceted impacts of the 32% import tariff imposed by the United States on Indonesian exports, analyzing the issue through both conventional economic frameworks and the lens of Islamic economics. The tariff, which targets key sectors such as textiles, footwear, and electronics, has weakened Indonesia’s export competitiveness, exacerbated the current account deficit, and depreciated the rupiah. These outcomes are compounded by inflationary pressures, declining domestic demand, and disruptions in industrial productivity due to increased input costs. To mitigate these effects, the paper advocates for export market diversification, domestic capacity building, and regulatory reform to attract foreign direct investment. It also underscores the role of monetary policy in maintaining macroeconomic stability and managing exchange rate volatility. Notably, the study identifies potential opportunities in the form of industrial relocation, which could position Indonesia as a strategic investment destination if supported by conducive policies and infrastructure. From an Islamic economic perspective, the analysis emphasizes ethical trade principles such as al-‘adl (justice), maṣlaḥah (public interest), and the prohibition of exploitative practices. While tariffs may be justified for protecting essential sectors, they must align with the objectives of maqāṣid al-sharī‘ah, promoting societal welfare and economic justice. The paper concludes by calling for policy responses rooted in both strategic pragmatism and Islamic moral imperatives, enabling Indonesia to navigate global trade disruptions while upholding ethical economic governance.
Introduction
Amidst the intensification of global economic interdependence, protectionist measures enacted by advanced economies—most notably the United States—have had widespread ramifications for developing nations. A salient example of such policy is the imposition of a 32% import tariff by the Trump administration targeting a range of Indonesian exports. This unilateral trade barrier not only distorts bilateral trade flows but also heightens market volatility and threatens Indonesia’s economic structure.
As a trade-dependent emerging economy, Indonesia is particularly susceptible to the adverse effects…
