JAKARTA: Indonesia has announced its intention to conclude its free trade agreement negotiations with the European Union by the end of June, marking the possible end of nearly a decade of discussions.
Chief Economic Minister Airlangga Hartarto revealed the development following a high-level meeting with European Commissioner for Trade Maros Sefcovic in Brussels on Tuesday. “Indonesia and the European Union have agreed to conclude outstanding issues and we are ready to announce a conclusion of substantial negotiations by the end of June 2025,” Airlangga stated. However, he did not elaborate on the specific terms or progress achieved in the latest round of talks.
EU Ambassador to Indonesia Denis Chaibi responded by noting that “negotiations are ongoing and substance will determine timing,” and assured that further details would be shared once a formal outcome is reached.
The European Union is currently Indonesia’s fifth-largest trading partner, with bilateral trade totalling US$30.1 billion in 2024. Indonesia recorded a trade surplus of US$4.5 billion during that period, underscoring the strategic importance of the agreement.
Negotiations have previously encountered challenges, particularly regarding EU regulations on products linked to deforestation, which could impact key Indonesian exports such as palm oil. Disputes have also arisen over Jakarta’s policy on the export ban of raw minerals.
Indonesia is accelerating its trade negotiations to diversify export markets in the face of growing trade uncertainties with the United States. The country is currently subject to a 32 per cent tariff rate under measures introduced by the Trump administration aimed at addressing global trade imbalances. These “reciprocal” tariffs are presently paused until July.
-Reuters
