Business · Trade · 14 hrs ago
Indonesia seeks EU trade deal signing before tariff benefits end
Indonesia is trying to sign its trade deal with the European Union this week.
The agreement, known as the IEU-CEPA, is intended to replace the EU's preferential tariffs for Indonesian exports.
Those tariff benefits are due to end on January 1, 2027, after Indonesia qualified as an upper-middle-income country for three years in a row.
Without an alternative, Indonesian goods could lose the reduced import duties they receive in the EU.
Economy Coordinating Minister Airlangga Hartarto says the deal must be signed and then ratified by both sides for it to take effect from the start of 2027.
Indonesia and the European Union still need to complete their respective ratification steps, and the deal's start date depends on that process.
Indonesia is seeking to sign its trade agreement with the European Union as soon as possible to avoid losing tariff benefits.
Coordinating Economic Minister Airlangga Hartarto said the EU’s Generalised Scheme of Preferences for Indonesia is due to end on 1 January 2027.
He said signing the Indonesia-EU Comprehensive Economic Partnership Agreement by the end of the week could allow ratification to proceed in both Indonesia and the EU.
The government hopes the agreement will take effect at the start of 2027.
Indonesia may leave the GSP scheme after being classified as an upper-middle-income country for three consecutive years.
- Who
- Indonesia and the European Union. Coordinating Economic Minister Airlangga Hartarto described Indonesia’s effort to secure the deal.
- What
- Indonesia is seeking to sign the Indonesia-EU Comprehensive Economic Partnership Agreement before its EU tariff preferences expire.
- When
- The GSP benefits are due to end on 1 January 2027. Hartarto said the agreement could be signed by the end of the week.
- Where
- The announcement was made in Jakarta.
- Why
- Indonesia wants to secure a trade agreement before it loses tariff relief under the EU’s Generalised Scheme of Preferences.
This story does not have two clearly opposing sides.
Hartarto said the agreement was at the stage of preparing complete documentation in English.
Hartarto urged that the agreement be signed as soon as possible, ideally by the end of the week.
The EU’s GSP tariff benefits for Indonesia are due to end.
- Agreement
- Indonesia-EU Comprehensive Economic Partnership Agreement (IEU-CEPA)
- Tariff scheme
- EU Generalised Scheme of Preferences (GSP)
- GSP end date
- 1 January 2027
- Proposed signing
- By the end of the week, if possible
- Eligibility context
- Indonesia may leave GSP after three consecutive years as an upper-middle-income country
What people are saying
Kita segera perjanjian EU-CEPA. Tanggal 1 Januari tidak tanda tangan, kita GSP facility akan mati karena GSP diberikan kepada negara low income
Makanya solusi CEPA tanda tangan kalau bisa akhir minggu ini, awal November parlemen EU, kita juga ratifikasi di Indonesia, maka Januari berlaku. Kita duluan dari Kanada