Indonesia’s response to US tariffs: a closer look at public perception and concerns

On 2 April 2025, former US President Donald Trump announced a wave of new tariffs targeting Southeast Asia—sending shockwaves across the region. Indonesia, facing a 32% tariff rate, has found itself in the crosshairs, leaving many wondering: what does this mean for their daily lives, their wallets, and the future of the country’s economy?

To understand how Indonesians are reacting, Milieu Insight surveyed 1,015 individuals across the country. The findings reveal not only strong awareness, but also a growing sense of unease about what lies ahead.

‘Did you know?’

Three in four Indonesians (75%) said they were aware of the new tariffs, showing high public engagement with the issue. Interestingly, younger Indonesians (aged 16–24) were slightly less likely to be aware compared to their older counterparts.

But awareness is only the start. When asked how concerned they were, 73% of respondents said they were worried about the impact on their daily lives. It’s not just an abstract policy change—it feels personal.

‘What’s at stake?'

The majority of Indonesians believe these tariffs will deal a blow to the national economy. In fact, 86% expect a negative impact, with 17% predicting things will become “very negative.”

Indonesia’s economy relies heavily on trade. For everyday people, the concern isn’t rooted in economics textbooks—it’s about rising costs, business sustainability, and overall stability.

‘Will my wallet take a hit?’

The looming question: will life become more expensive? According to the survey, 64% of Indonesians believe the tariffs will lead to higher prices for goods. Nearly a third (28%) fear the increases will be significant.

Electronics and gadgets (60%) and automobiles (49%) top the list of product categories people expect to be affected. These aren’t just luxuries—they’re practical tools and modes of transport that play a role in daily life.

‘Adjusting to the new reality’

With the cost of imported goods expected to rise, many Indonesians are preparing to shift their habits. Nearly two-thirds (64%) said they would choose local alternatives instead. This move isn’t just patriotic—it’s strategic.

Young Indonesians are particularly responsive. Among those aged 16–24, 73% said they’re ready to go local. Whether it’s food, fashion, or homegrown tech, the next generation is leading the way in embracing Indonesian-made products.

Others plan to simply reduce their consumption of imported goods (21%), while a small portion (4%) intend to carry on spending as usual.

‘What will businesses do?’

As consumers tighten their belts, businesses are expected to act. Half of Indonesians (50%) think companies should absorb the higher costs and maintain pricing. But there's a twist—many also want more promotions and discounts (47%) to help soften the blow.

Still, not all expectations are optimistic. Around 15% suspect that companies might respond by cutting corners and reducing product quality. This presents a challenge: how can businesses remain competitive without compromising customer trust?

‘Can we count on the government?’

The survey also explored whether Indonesians believe their government is ready to tackle the situation. While 11% feel “very confident” in the government’s ability to respond, a larger group (35%) are “not very confident”—a sentiment that increases with age.

Nevertheless, many have clear ideas about what the government should do. A majority (58%) want stronger support for local industries to reduce dependence on US imports. Nearly half (49%) believe in controlling prices of essential goods. Others (28%) hope to see subsidies to cushion the impact on consumers.

A nation on edge, but ready to adapt

The findings reveal a nation that’s wary—but also willing to adapt. Indonesians are concerned, but they aren’t standing still. They’re preparing to shift spending, support local businesses, and call on leaders to take decisive action.

The tariffs may signal tougher times ahead, but they’ve also sparked a renewed focus on self-reliance and resilience. As Indonesia navigates this uncertain terrain, one thing is clear: the people are ready to respond—with caution, with care, and with a commitment to weather the storm.

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