ASIATODAY.ID, BRUSSELS – The trade negotiations between Indonesia and the European Union (EU) under the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA) have officially reached the final stage, July 13, 2025.
This milestone was marked by an exchange of letters between Indonesia’s Coordinating Minister for Economic Affairs, Airlangga Hartarto, and European Commissioner for Trade, Maroš Šefčovič, symbolizing a high-level political agreement to accelerate the finalization of the pact.
This exchange underscores a shared commitment to resolving the remaining substantial issues and to concluding the IEU-CEPA in a balanced and mutually beneficial manner. It also reflects both parties’ resolve to strengthen trade and investment ties that have been under negotiation since 2016.
“I deeply appreciate the EU’s continued commitment and constructive engagement. Commissioner Maroš and both negotiating teams have played a vital role throughout the entire IEU-CEPA process,” said Coordinating Minister Airlangga.
“This political agreement is the most significant milestone since the negotiations began. IEU-CEPA will be a key instrument to deepen our strategic engagement with Southeast Asia,” emphasized Commissioner Šefčovič.
IEU-CEPA to Remove 80% of Tariff Lines, Unlocking Market Potential
The IEU-CEPA agreement is set to eliminate approximately 80% of tariff lines, paving the way for enhanced exports and increased market access between the two major economies. With a population of over 285 million, Indonesia offers a large and dynamic market for European businesses, while the EU’s 400 million consumers represent a powerful economic bloc for Indonesian exporters.
The finalization of negotiations was also officially announced during a bilateral meeting between President of the Republic of Indonesia, Prabowo Subianto, and President of the European Commission, Ursula von der Leyen, held on July 13, 2025, in Brussels.
“Europe leads in science, technology, and finance. Indonesia possesses key resources. This partnership will be crucial for ensuring economic and geopolitical stability in the world,” stated President Prabowo.
President von der Leyen confirmed that a political agreement has been reached, forming the foundation for concluding the IEU-CEPA in the near term.
“This agreement will also help strengthen supply chains for critical raw materials that are vital to Europe’s green and steel industries. I now look forward to a swift conclusion of the deal,” she added.
President Prabowo also expressed his appreciation to both negotiating teams, calling the outcome a strategic breakthrough.
“There are no longer any major issues dividing Indonesia and the EU—this is truly extraordinary,” said President Prabowo.
Negotiation Enters Finalization Phase Towards Ratification
The IEU-CEPA negotiations have gone through 19 formal rounds and multiple intersessional meetings since their launch in July 2016. Indonesia’s technical negotiations have been led and coordinated by the Directorate General of International Trade Negotiations, Ministry of Trade.
Minister Airlangga emphasized that this high-level agreement will now be followed by technical fine-tuning and timeline mapping with the aim of official ratification in September 2025.
“Even on a Sunday, we are here working. We work seven days a week. No weekends, no holidays—just full commitment. I commend the team’s tireless effort to reach this point,” said Airlangga.
Commissioner Šefčovič reaffirmed that this breakthrough demonstrates a shared vision for a forward-looking, inclusive, and comprehensive agreement, capable of serving as a solid foundation for long-term bilateral relations.
“This shows that we’re working day and night, weekend after weekend, to improve EU–Indonesia ties and unlock new business opportunities—for companies, SMEs, and both our economies,” said Šefčovič.
The IEU-CEPA agreement is expected to enhance business opportunities, provide legal certainty, and establish a strategic platform for deepening dialogue and cooperation across various critical economic issues. (AT Network)
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