Indonesia and the European Union are on track to finalize the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA), with full implementation targeted for the first quarter of 2027. This agreement, a result of nearly a decade of negotiations, promises significant changes to trade relations.
The IEU-CEPA aims to boost Indonesian exports, potentially increasing them by up to 50% within three years of full implementation. Key benefits include the elimination of import duties on 80% of Indonesian exports to the EU market. This includes products like textiles, fish, footwear, and palm oil.
The agreement covers a wide range of areas, including trade in goods and services, investment, intellectual property rights, and sustainable development. This comprehensive approach is designed to create a healthier trade and investment ecosystem. The deal is expected to improve investment from the EU, which was down in 2024.
The ratification process across the 27 EU member states is expected to take up to a year. Indonesian industries are encouraged to prepare by engaging with European partners, improving product quality, and enhancing competitiveness. The IEU-CEPA is seen as a strategic step for Indonesia to strengthen its position in the global trade landscape.