KONTAN.CO.ID - JAKARTA. The United States and Indonesia are discussing joint measures to monitor and manage trade in Indonesian critical minerals that have strategic value, an Indonesian minister said on Thursday as he gave details of ongoing talks between the two countries.

Indonesia is one of only a only a handful of countries to strike a deal with Washington to lower U.S. tariffs ahead of an August 1 deadline.

The deal - referred to by the White House as an agreement on the negotiating framework - saw tariff rates on Indonesian products lowered to 19% from an earlier 32%.

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But chief economic minister Airlangga Hartarto told journalists that the two sides were still in discussions about how to better regulate trade in vital, dual-use commodities.

"Strategic trade management is important to ensure transparency between both parties so that imports and exports of dual-function commodities with strategic value can be monitored," he said in a briefing on the agreement recently struck with the United States.

Commodities considered strategic are those used in Artificial Intelligence infrastructure, data centres, aviation, and the aerospace and space flight industries, he said.

"So they (the United States) want to ensure that these strategic components do not fall into the hands of certain parties, including for use in terrorism or other purposes," Airlangga said.

Indonesia, an archipelago and the largest economy of Southeast Asia, has large reserves of a number of critical minerals as well as deposits of rare earth elements.

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It is also the world's largest producer of nickel products, the biggest exporter of tin, and a major producer of copper. Chinese companies currently dominate the processing industry for nickel and bauxite in Indonesia.

Airlangga also said that negotiations were on between the two countries to lower tariffs on Indonesian commodities entering the United States, adding that the rate could be close to 0%.

The lower tariff could be applied on commodities that the United States cannot produce itself, the minister said.

He also added the two were discussing rules of origin and to what extent a "third party vendor" can be involved to be eligible for the lower tariff rates offered to Indonesian exports entering the U.S. market.