Indonesia Targets Year-End Finish for Landmark EU Trade Pact as Business Lobby Urges Global Push

JAKARTA, Investortrust.id — Indonesia is racing to cross the finish line on its long-negotiated trade pact with the European Union by the end of 2026, prompting the country’s top business lobby to urge domestic exporters to prepare for an aggressive European market push.

Speaking after a closed-door consultation with Indonesian Ambassador to Belgium, Luxembourg, and the European Union Andy Rachmianto at the Kadin headquarters in South Jakarta on Tuesday, Oct. 13, 2026, Kadin Chairman Anindya Novyan Bakrie said domestic industries must be ready to seize immediate export opportunities once the deal is cleared.

"Hopefully, the ratification of the I-EU CEPA trade agreement with the European Union will be up and running before the end of this year," Anindya said. "The Ambassador highlighted the uphill battle required to reach this stage, as well as the massive economic impact this will deliver for Indonesia's trade balance."

Confronted by rising global trade headwinds and an urgent need to diversify export destinations beyond traditional buyers, Southeast Asia's largest economy is betting that preferential access to the 27-nation European bloc will revitalize factory order books. For nearly a decade, Indonesian manufacturers have faced steep tariff disadvantages in Europe compared to regional competitors such as Vietnam and Singapore, which already operate under operational free-trade pacts with Brussels. Finalizing the agreement provides an essential springboard to scale value-added industrial shipments and attract premium European direct investment.

Unlocking High-Margin Export Corridors

Anindya emphasized that dismantling bilateral trade barriers will widen market access across several of Indonesia’s most competitive non-commodity export sectors. Key industries positioned for immediate upside include footwear, textiles and garments, furniture, electronics, processed food lines, and specialty coffee.

Those product lines already form the backbone of Indonesia’s manufacturing exports into advanced markets such as the United States. Gaining equivalent, duty-free entry into Europe opens an expansive parallel consumer base with significant purchasing power.

"These happen to be the exact same powerhouse sectors that we ship to markets like the United States," Anindya noted. "Opening up a broader market for essentially the same product categories represents a monumental commercial opportunity."

Leveling the Regional Playing Field

Indonesian Ambassador Andy Rachmianto underscored that strong institutional backing from Kadin and the domestic private sector is paramount to ensure the agreement translates into real commercial contracts rather than remaining paper commitments.

The European single market commands enormous consumer demand, and securing streamlined access will enable Indonesian commodities and processed goods to gain durable market share.

"Our shared hope is that, just as our ASEAN peers like Singapore and Vietnam have demonstrated, this CEPA agreement will serve as the primary growth engine for our export products entering European nations," Andy said.