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Economic Risks of Trump 2.0 Tariff on Indonesia’s Export Performance and Industrial Sector: GTAP Model

In: Proceedings of the International Conference on Contemporary Risk Studies (ICONIC-RS 2025)

Author

Listed:
  • Muhammad Royhan Alamsyah

    (Universitas Pertamina)

  • Eka Puspitawati

    (Universitas Pertamina)

Abstract

President Trump’s re-election has brought global economic uncertainty through the implementation of increased reciprocal tariffs imposed on many countries, including Indonesia. This study aims to analyze the effects of the US tariff policy during Trump’s second term on Indonesia’s export performance and industrial sectors. The analysis employs secondary data and the GTAP model version 11. The results indicate that Indonesia is likely to face economic risks in the form of declines in GDP, output, investment, and exports. At the microeconomic level, plant-based fibers, wheat, and metals nec emerge as sectors experiencing the largest positive impacts, while the manufacturing industry, wearing apparel, rubber and plastic products, textiles, and crops face the greatest threats of output contraction. These findings provide important policy implications for Indonesia in designing national strategies to strengthen trade resilience, particularly through export market diversification, industrial sector adjustment, and enhanced engagement in regional and multilateral trade frameworks to mitigate external trade shocks.

Suggested Citation

  • Muhammad Royhan Alamsyah & Eka Puspitawati, 2026. "Economic Risks of Trump 2.0 Tariff on Indonesia’s Export Performance and Industrial Sector: GTAP Model," Advances in Economics, Business and Management Research, in: Eka Puspitawati & Dewi Hanggraeni & Indra Kusumawardhana & Parulian Sihotang & Nanda Nurdianto (ed.), Proceedings of the International Conference on Contemporary Risk Studies (ICONIC-RS 2025), pages 55-68, Springer.
    • Handle: RePEc:spr:advbcp:978-2-38476-595-9_5
    DOI: 10.2991/978-2-38476-595-9_5
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