Jakarta (VNA) – Indonesia has pushed back the deadline for its trade pact with the European Union (EU), with Jakarta eyeing to complete the negotiations in the first half of 2025.
Both sides have been negotiating the Comprehensive Economic Partnership Agreement (CEPA) since 2016. Former President Joko Widodo wanted to finish the trade pact last year, although time has shown that they failed to come to a conclusion in 2024. As Indonesia welcomes a new year, the Trade Ministry has renewed the Indonesia-EU CEPA target, now aiming to conclude the talks no later than this June.
Trade Minister Budi Santoso told reporters that the two sides have already substantially concluded 85% of the pact but did not say what had been causing the delay, forcing the pact to undergo 19 rounds of talks and counting.
Bogor city hosted the most recent round of negotiations that would significantly ease trade barriers in mid-2024. A report from the meeting revealed that both sides had not come to an agreement on export and import restrictions. Their discussions on investment conditions also remained inconclusive.
Indonesia has set an export target of nearly 294.5 billion USD for 2025. The archipelagic country also wants its micro, small and medium businesses to contribute 19.3 billion USD to the overall export figures this year.
In 2023, Indonesia-EU trade amounted to 30.8 billion USD with Jakarta posting a 2.6 billion USD surplus, government data shows. Indonesia mainly exports palm oil to the EU.
Despite being a consumer of Indonesian palm oil, the European bloc has been critical of the country’s top commodity. It has even raised trade barriers by launching the EU Deforestation Regulation (EUDR) which mandates exporters to prove that their palm oil does not come from deforested land. The EUDR was supposed to enter into force late last month. Companies now have a year to comply with the rules with micro and small-scale enterprises having extra time until the end of June 2026./.
