When Beijing’s foreign ministry issued its now-familiar line that the recent Indonesia‑US trade agreement “should not harm any third party,” some analysts urgently warned of possible economic retaliation.
Yet a closer look at the geopolitical economics suggests this framing misunderstands both China’s incentives and the real dynamics at play. China isn’t preparing to hit back at Jakarta — and if it reacts at all, it won’t target Indonesia but the US.
On February 19, Indonesia and the US signed the Agreement on Reciprocal Trade (ART), a deal that sets a 19% tariff level on many goods and restructures a significant portion of their commercial…