Countries and regions
Following successful exploratory discussions in April 2016 to further deepen EU-Indonesia trade and investment relations, negotiations for an EU-Indonesia free trade agreement were launched on 18 July 2016.
The ambition is to conclude a free trade agreement that facilitates trade and investments and covers a broad range of issues, including tariffs, non-tariff barriers to trade, trade in services and investment, trade aspects of public procurement, competition rules, intellectual property rights as well as sustainable development.
A Free Trade Agreement will develop a key aspect of the overall relationship between the EU and Indonesia which is framed by the Partnership and Cooperation Agreement which entered into force on 1 May 2014.
- Indonesia is the largest economy in the Association of Southeast Asian Nations (ASEAN). It represents about 36% of the region's GDP and has the largest population (250 million inhabitants).
- Bilateral trade in goods between the EU and Indonesia amounted to €25.3 bn in 2015, with EU exports worth €10 bn and EU imports worth €15.4 bn. The EU is Indonesia's fourth partner. Indonesia is the fifth EU partner in ASEAN and in the same year, it ranked 30th in the overall EU trade worldwide.
- Bilateral trade in services between EU and Indonesia in 2014 amounted to €6 bn in 2014, with EU exports amounting to €4.1 bn and Indonesia's exports amounting to €1.9 bn
EU-Indonesia "trade in goods" statistics
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EU-Indonesia "trade in services" statistics
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Foreign direct investment
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EU and Indonesia
The relation between the EU and Indonesia has deepened over recent years.
Over many years, relations have been framed by the EC Cooperation Agreement with the Association of South East Asian Nations (ASEAN) which was formalised in 1980. On this basis, economic and political discussions have been held regularly. Bilateral dialogues between the EU and Indonesia have included periodic reviews of political, economic and co-operation issues in Senior Official Meetings.
A Framework Agreement on Comprehensive Partnership and Co-operation was signed on 9 November 2009 and entered into force on 1 May 2014. The Agreement provides the basis for holding regular political dialogue and sectoral cooperation and takes bilateral relations to an higher level. The Agreement provides the legal framework to engage and cooperate across a wide spectrum of policy fields, including human rights, political dialogue, trade. A Free Trade Agreement will develop a key aspect of our overall bilateral relation with Indonesia.
Indonesia currently benefits from trade preferences granted by the EU Generalised Scheme of Preferences, under which about 30% of total imports from Indonesia enjoyed lower duties.
Indonesia in ASEAN
Indonesia is one of the 10 members of the Association of South East Asian Nations (ASEAN) and represents its largest (36% of ASEAN GDP) and most populated economy (250 inhabitants).
Indonesia is the 6th country in the region to start negotiations for a bilateral Free Trade Agreement (FTA) with the EU, after Singapore (2010), Malaysia (2010), Vietnam (2012), Thailand (2013) and the Philippines (2015). As of July 2016, the EU has completed negotiations for bilateral agreements with two of them: Singapore (2014) and Vietnam (2015). Bilateral Free Trade Agreements between the EU and ASEAN countries will serve as building blocks towards a future EU-ASEAN agreement, which remains the EU's ultimate objective.
ASEAN, as a whole, ranks as the 8th economy in the world and is the EU's 3rd largest trading partner outside Europe, after the United States and China. Bilateral trade in goods and services between the EU and ASEAN reached €246.5 billion in 2015. Indonesia is the largest and most populated economy in ASEAN (36% of ASEAN GDP and 255 million people). It is also one of the fastest growing economies in South East Asia (average GDP growth of 5.6% in the past 10 years).
Trading with Indonesia
- Rules and requirements for trading with Indonesia
- The EU is present on the ground in Indonesia
- Trade relations are part of the EU's overall political and economic relations with Indonesia
- Indonesia is a member of the World Trade Organisation
- Sustainable impact assessment of the EU-ASEAN Countries Free Trade Agreement (FTA)