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EU seeks to conclude trade negotiation with Indonesia before 2024 elections
Seeking to avoid the fiasco of finalizing negotiations during next year’s elections in Indonesia, the European Union wants to conclude trade negotiations by the end of this year, while its more controversial deforestation policy, which could hammer Indonesia’s palm oil industry, continues to cast a heavy pall in Jakarta.
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Workers load oil palm fresh fruit bunches to be transported from the collector site to crude palm oil (CPO) factories in Pekanbaru, Riau province, on April 27, 2022. (Reuters/Willy Kurniawan)
Seeking to avoid the fiasco of finalizing negotiations during next year’s elections in Indonesia, the European Union wants to conclude trade negotiations by the end of this year, while its more controversial deforestation policy, which could hammer Indonesia’s palm oil industry, continues to cast a heavy pall in Jakarta.
Significant progress on the long-awaited Indonesia-EU Comprehensive Economic Partnership Agreement (IEU-CEPA) has been reached, but it is paramount that the EU be flexible on some disputed issues, including its climate stance, Indonesia’s top officials said.
Six members of the European Parliament International Trade Committee (INTA) embarked this week on a two-day visit to Jakarta to advance negotiations on the IEU-CEPA. On Tuesday, they met with Coordinating Economic Affairs Minister Airlangga Hartanto, Trade Minister Zulkifli Hasan and Investment Minister Bahlil Lahadalia as well as lawmakers overseeing trade.
The IEU-CEPA, first negotiated in 2016, aims to facilitate and create new market access for both countries, in turn increasing opportunities for trade and direct investment.
Yet seven years of negotiations later, the awaited document remains elusive, with disagreements over the EU’s environmental stance on trade and its impacts on developing countries at the center of the debates. This stance, which seeks to discriminate against the import of products linked to deforestation, has been further cemented by the new EU Deforestation Regulation (EUDR) that will soon impose bans on such products, including Indonesian palm oil commodities.
The continued disagreement between Jakarta and Brussels has started to worry business players, who have urged the government to not let the deforestation issue hamper the ongoing IEU-CEPA talks.
