Indonesia, EU still can’t agree on trade pact’s import permit
Jakarta Globe - 19 March 2025
Indonesia, EU still can’t agree on trade pact’s import permit
Indonesia and the European Union or EU are still trying to reach a consensus on import licensing in their free trade agreement talks, according to a senior minister.
Indonesia and the EU have been negotiating a comprehensive economic partnership agreement (CEPA) since July 2016. Almost ten years have passed, but both sides have yet to reach an agreement. Speaking to reporters, Airlangga said he had just reported back to President Prabowo Subianto on the latest updates for the CEPA negotiations. While the talks are making some progress, Airlangga revealed that Indonesia and the EU still could not agree on issues related to import licensing.
"The Indonesia-EU CEPA negotiations still have two issues that we have to deal with, ... namely export duties and import permits. I have reported the [updates] to Mr. President," Airlangga told a press briefing at Jakarta’s palace on Tuesday.
As many as 19 rounds of talks have taken place with the most recent one being held in Bogor last July. A report published on the 19th round wrote that the discussions remained "inconclusive" on export and import restrictions, as well as investment conditions. The typical free trade agreement significantly reduces or eliminates tariffs on trade between the participating countries.
Prabowo’s predecessor Joko "Jokowi" Widodo had aimed to have the CEPA signed no later than 2024. However, Indonesia later postponed the deadline to the first half of 2025. Last month, Prabowo told the press that work was underway to speed up the Indonesia-EU CEPA negotiations alongside other free trade agreements.
In 2023, Indonesia-EU trade totaled $30.8 billion with the Southeast Asian economy running a $2.6 billion surplus, data showed. In other words, Indonesia is exporting more than it imports from the EU. Palm oil is Indonesia’s leading export to the EU, although the European bloc is about to restrict the entry of this agricultural commodity. The EU’s anti-deforestation regulation policy, EUDR, will mandate companies to prove their Europe-bound palm oil products do not come from deforested lands by showing the exact coordinates of their plantations. The EUDR will come into effect for large and medium companies in end-2025. Smaller enterprises still have time until mid-2026 before they will have to comply with the EUDR.
