Assessing Indonesia’s Relations with the US After Joining BRICS

Indonesia under President Prabowo Subianto has officially joined the Brazil, Russia, India, China and South Africa (BRICS) organisation as a full member. Chair Brazil announced this on 6 January 2025. BRICS’ decision to accept Indonesia’s membership indicates motivation to expand the bloc’s influence in promoting emerging economies, especially in the Indo-Pacific.

Prabowo probably sees joining BRICS as a chance for another leadership role in the international arena. The president envisions himself as a modern-day Sukarno, Indonesia’s founding father and first president. Sukarno was a major proponent of the Non-Aligned Movement (NAM) and greatly influenced Indonesia’s foreign policy during the Cold War era. In the current geopolitical context, Prabowo wants to cast Indonesia as a potential bridge between the global North and South.

Second, Prabowo likely believes Indonesia would gain economic benefits and leverage by joining the bloc. However, given some BRICS members’ opposition to the Western economies, this may strain Indonesia’s relations with the US and other Western partners.

Indonesia’s Foreign Minister Sugiono has stated that Indonesia’s full membership shows the importance of Indonesia to BRICS, adding that this manifested Indonesia’s “free and active” foreign policy. A spokesperson from Parliament called it a “brave breakthrough”, arguing that Indonesia could become “the balancer and central barometer of world power”.

A key question is, how might Indonesia’s relations with the US (and the West) change after joining the bloc?

Critics have argued that BRICS membership could complicate Indonesia’s relationships with the US and European Union (EU). For example, BRICS’ declared intention to use local currencies for trading among members may undermine the US dollar’s dominance in international trade and even trigger punishment from US President Trump’s administration. Nonetheless, de-dollarisation remains more of an aspiration than a real threat to US dollar dominance.

If it can rapidly expand, however, BRICS as a grouping may potentially change the world’s economic map over time. While it has its weaknesses, Indonesia’s economic heft could strengthen BRICS’ collective influence and bargaining power in global economic diplomacy. BRICS is also an alternative platform to showcase Indonesia’s independence and openness to different forms of economic cooperation. This is even as Indonesia has applied for membership in the Organization for Economic Cooperation and Development (OECD) and is part of the Indo-Pacific Economic Framework (IPEF) – although under President Trump, IPEF may be discontinued.

Joining BRICS arguably risks worsening Indonesia’s relations with the US, as some see the bloc as a threat to US- or Western-led international economic institutions. However, Indonesia might take the risk as it calculates that it needs other international partners to support Prabowo’s economic and development agenda at home, focused on food and energy security, with fewer strings than those imposed by Western partners. As trade with markets like the US and Europe has become more difficult with increasing politicisation, BRICS membership may open up alternative export markets for Indonesia. This is especially given the implementation of the EU Deforestation Regulation (EUDR), which hinders Indonesia’s palm oil exports to Europe.

Whether the US might punish Indonesia for this move will depend now on what concessions Prabowo might offer to Trump…

Also, Indonesia’s move anticipates stronger tariff uncertainties under Trump, who earlier warned BRICS that the US would impose a 100 per cent tariff if they were to create a rival currency. Trump’s threat to remedy the US’ trade deficit may also affect Indonesia, which has experienced a growing trade surplus with the US in recent years.

The US is Indonesia’s second largest trading partner after China. In 2024, Indonesia’s total exports to the US were worth US$24 billion, or 10 per cent of all exports (Figure 1). Exported items included mainly machinery, electrical equipment, textiles, footwear, and palm oil. If the US imposes 100 per cent tariffs against Indonesian exports, Indonesia will lose significant market share. Yet, Indonesia’s policymakers believe that Trump would not realise his threat. As the largest democratic country in Southeast Asia, with a vibrant and increasingly educated population, a geostrategically important location and abundant natural resources, Indonesia is a partner that the US cannot afford to alienate.

Figure 1. Indonesia’s Exports and Imports (US and China), 2022-2024

Value (in US$ billion)	Exports			Imports
	US	China	Total with the world	US	China	Total with the world
2022	28.2 (9.7%)	65.8 (22.6%)	291.9	11.6 (4.9%)	67.7 (28.5%)	237.4
2023	23.3 (9.0%)	64.9 (25.1%)	258.8	11.3 (5.1%)	62.9 28.3%)	221.9
2024	23.9 (9.9%)	56.4 (23.4%)	241.2	11.0 (5.2%)	65.4 (30.8%)	212.4

With the war in Ukraine not abating, Energy and Mineral Resources Minister Bahlil Lahadalia has said that joining BRICS would allow Indonesia to secure cheap oil imports from Russia. One may argue that Indonesia can do this without joining BRICS but by joining the bloc, Indonesia might get some priority in securing its energy needs compared to non-members. This aligns with the government’s energy security policies even if it is a less palatable stance from the EU and US’ view. Bahlil’s deputy Yuliot Tanjung has said that Indonesia will use its BRICS membership to export mining products, especially to China and India, in anticipation of tariff or trade protection from the West.

Meanwhile, Indonesia remains committed to full OECD membership, which will be critical for it to continue structural reforms to achieve international standards, especially in governance.

Indonesia may face challenges in balancing its trade and investment relations with other BRICS members. Ironically, with their comparative advantages and greater economies of scale, some BRICS members may dominate strategic sectors, creating unbalanced economic relations and possibly worsening Indonesia’s dependency.

Joining BRICS may be seen as a bold step to position Indonesia globally, to expand its international influence and strengthen its bargaining power while hedging against uncertainties. Whether the US might punish Indonesia for this move will depend now on what concessions Prabowo might offer to Trump, and what concrete actions Prabowo takes to promote the global South via BRICS. As the geoeconomic landscape continues its shift, whether BRICS helps to raise Indonesia’s limited capacity as a middle power might partly determine whether Prabowo can fulfil his vision to become a twenty-first century Sukarno.  

2025/28