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View all search resultsEU–Indonesia CEPA: Turning commitments into trade and investment opportunities
Sweden and Indonesia’s partnership is increasingly focused on the future: supporting Indonesia’s industrial transformation while accelerating digitalization and the green transition in a rapidly changing global economy.
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President Prabowo Subianto (left) and European Commission President Ursula von der Leyen announce the 'political agreement' of the Indonesia-EU Comprehensive Partnership Agreement (IEU-CEPA) on July 14, 2025, in Brussels. (Presidential Secretariat Press Bureau/Laily Rachev)
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weden and Indonesia have been partners for more than 75 years. Today, that partnership is increasingly focused on the future: supporting Indonesia’s industrial transformation while accelerating digitalization and the green transition in a rapidly changing global economy.
Swedish companies have been part of Indonesia’s economic development for decades. Today, around 80 Swedish companies are established in the country. Their investments bring more than capital. Swedish companies contribute technology, skills and solutions that can support Indonesia’s ambition to move up global value chains.
Our relationship has also benefited from the Sweden–Indonesia Sustainability Partnership (SISP), which for several years has brought our two countries together to develop concrete cooperation in sectors central to Indonesia’s economic transformation.
The EU–Indonesia Comprehensive Economic Partnership Agreement (CEPA) can take our relationship to the next level.
CEPA will create a free trade area covering more than 700 million people. The European Commission estimates that, once fully implemented, the agreement could increase Indonesia’s exports to the EU by around 2.6 billion euro (US$2.9 billion) and Indonesia’s GDP by around 27 billion euro. These gains are expected across sectors, with positive effects on investment and incomes.
CEPA could also help Indonesia deliver on its broader economic priorities. The agreement comes at a time when Indonesia has set ambitious goals for industrialisation, downstreaming, job creation, digitalization and growth. CEPA can reinforce these ambitions by supporting greater integration into international markets and encouraging reforms that strengthen productivity and competitiveness.
The potential gains are substantial. The World Bank estimates that a package of trade reforms could increase Indonesia’s GDP by almost 8 per cent and labour incomes by more than 11 per cent by 2040. CEPA should therefore be seen as part of a wider opportunity: using international economic integration to attract investment, strengthen productivity and create more competitive Indonesian companies and better jobs.
