Indonesia, EU reach free trade deal, says Jakarta

Indonesia on Tuesday said it has reached a free trade agreement with the EU after nearly a decade of negotiations, according to the state-run media.

Haryo Limanseto, spokesperson of the Coordinating Ministry for Economic Affairs, said the Comprehensive Economic Partnership Agreement (CEPA) is a historic milestone in building a foundation for economic cooperation that is more inclusive, sustainable, and mutually beneficial, Antara News reported.

"After nine years of negotiations, under the leadership of President Prabowo Subianto, the IEU-CEPA has finally reached an agreement," said Haryo.

The agreement is expected to be signed by both sides later Tuesday in Bali.

The EU is Indonesia's fifth-largest trading partner, with bilateral trade reaching $30.1 billion in 2024. Indonesia also recorded a surplus in its trade balance, which rose sharply from $2.5 billion in 2023 to $4.5 billion in 2024, driven largely by key exports such as palm oil.

Last month, Indonesian Trade Ministry official Djatmiko Bris Witjaksono said the agreement covers market access for goods, with both sides committed to eliminating tariffs on 98% of total tariff items and 99% of total import value.

Once signed, the agreement is likely to take effect in 2027.