European Union Concludes CEPA Talks with Indonesia

The decade-long negotiations for the European Union (EU) and Indonesia in having Comprehensive Economic Partnership Agreement (IEU-CEPA) have concluded with both sides agreeing to sign the treaty after reaching consensus on all aspects of the agreement.

The announcement was made by European Commission President Ursula von der Leyen Indonesian and Indonesian President Prabowo Subianto during a joint press conference in Brussels, Belgium on Sunday.

“Today, we have achieved a breakthrough. After 10 years of negotiations, we have concluded a comprehensive economic partnership agreement, which basically is a free trade agreement,” Prabowo remarked.

“Basically, there are no items of disagreement between the EU and Indonesia. In this era of instability or confusion, I think we set the right example,” he said while expressing his appreciation for the successful outcome. The CEPA implementation document would be signed soon, Probowo added.

Ursula von der Leyen said that the new agreement will now open new markets and create more opportunities in key industries. Businesses active in agriculture, automotive, and services will massively benefit from it.

This agreement will also help strengthen the supply chains of critical raw materials that we need to power the clean and digital transitions, she said.

“Mr President, I want to thank you for your leadership. Together, we are sending a strong signal about the importance of predictable, long-term partnerships. Partnerships that are built on trust, reciprocity, transparency and shared values,” she said.

Reminding that this new trade agreement will bring great opportunities to people from both regions, she said that Indonesia is one the largest economies in the world, with a GDP of $1.4 trillion. It is a leading supplier of goods that are vital for the digital and green transitions; and it represents a growing market of over 287 million people.

“Together, we represent a market of 730 million people. Indonesia is also the ASEAN country with the largest economy. But, today, it is only the EU’s fifth trade partner in the region, and the EU’s fifth largest recipient of Foreign Direct Investment (FDI) among the ASEAN countries,” she pointed out.

She emphasised that Indonesia plays a major role as a key supplier of vital goods to Europe, its status as the EU’s fifth-largest recipient of foreign direct investment, and fifth-largest trade partner in Southeast Asia.

She also expressed optimism about the untapped potential in bilateral trade, saying the CEPA arrives at the right time to unlock new markets and opportunities.

Visa Cascade

She said that Indonesian people should be the first to benefit from their stronger ties and the Commission has took a decision on the visa cascade.

“It means that from now on, Indonesian nationals visiting the EU for a second time will be eligible for multi-entry Schengen visas. This will make it easier to visit, invest, study and connect. In short, we are building a bridge between our societies,” she added.