Indonesia, EU Seal Landmark Trade Deal After Nearly A Decade of Talks

Indonesia and the European Union on Tuesday finalised the details of a trade agreement after nearly a decade of talks. The deal provides a "substantive conclusion” to the trade talks removing the 80 percent tariffs on Indonesian products in the European market, Reuters reported.

The top commodities exported from the Indonesian market including palm oil as well as fishery and textile products will also be relieved, Indonesian officials said. Indonesia's chief economic minister Airlangga Hartarto said that he intends for the pact to come into effect on January 1, 2027.

The Indonesia-European Union Comprehensive Economic Partnership Agreement (CEPA) is the third such agreement with South Asian countries following Singapore and Vietnam. The pact was signed by EU Trade Commissioner Maros Sefcovic and Indonesian Minister of Economic Affairs Airlangga Hartarto.

Indonesia has claimed for bilateral trade to double within the first five years of the agreement’s implementation. 

According to Indonesia's economic ministry, the trade stood at $30.1 billion in 2024. Indonesia and the European Union finalised negotiations on a trade agreement Tuesday (September 22, 2025) after nearly a decade of talks, a senior minister said.

The Indonesia-European Union Comprehensive Economic Partnership Agreement (CEPA) is the third such deal which has been signed with Southeast Asian countries, after Singapore and Vietnam.

The pact was signed by EU Trade Commissioner Maros Sefcovic and Indonesian Minister of Economic Affairs Airlangga Hartarto in Bali and will open investment in strategic sectors such as electric vehicles, electronics, and pharmaceuticals.

“By finalising this agreement, the EU and Indonesia are sending a powerful message to the world that we stand united in our commitment to open rules-based and mutually beneficial international trade,” Sefcovic said, AFP reported.