JAKARTA – The trade ministry (Kemendag) has ensured that Indonesia’s export products, from textiles to palm oil and derivatives, will get zero percent (0%) tariff under the Indonesia–European Union Comprehensive Economic Partnership Agreement (IEU-CEPA), which is expected to be effective since September 2025.
“So, for example, our apparel products will get the zero tariff when the agreement starts its EIF (entry into force). Products of footwear, apparels, textiles, processed foods, and even palm oil and derivative products, will be included into the entry into force,” Kemendag’s International Trade Negotiation Director General, Djatmiko Bris Witjaksono, was quoted by Antara as saying on Monday (4/8/2025).
He said that the scope of IEU-CEPA includes the market access of goods. Optimum market access is given to products with comparative advantage, such as footwear, textiles and textile products, fishery, processed foods, palm oil and derivatives (including biodiesel), electronics, agricultural and forestry products and steel.
The IEU-CEPA, which is the most comprehensive bilateral trade agreement achieved by Indonesia, consists of 25 chapters and covers aspects of liberalization, trade facilities, cooperation and new issues.
Djatmiko said that by considering the commitment, 98% of all tariff posts will get preferences. “So, only a few are exempted by EU,” he said.
“I think in terms of total value of EU’s imports from Indonesia already reached 100%. In terms of our exports, 99% of all of our exports to EU will get preferences. It will be realized in different times, but almost all within the EIF. But negotiations are still underway regarding which goods will get it within the third year and which goods will be on the fifth year,” he said.
“We want it that all of our goods will get it directly upon EIF. Let’s just pray that all products of Indonesia will get the same chance at initial stage,” he said.
Signed in September
Economic Coordinating Minister Airlangga Hartarto said that the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA) will be signed in September 2025.
“Regarding the IEU-CEPA, we’re confident that we will sign it in September and we’ll finalize all documents. I’ve discussed it with EU Commissioner Maros Sefcovic. He has planned to come to Jakarta in September to sign the document,” Airlangga said at the office building of his ministry on Friday (01/08/2025).
He said that based on the trade agreement of IEU-CEPA, Indonesia will get import tariff of zero percent for crude palm oil (CPO) and Palm Kernel Oil (PKO) and derivative products entering the EU market.
Overall under the IEU-CEPA, around 80% of tariff posts will be zero percent, opening bigger opportunities of trade and investments for both sides of Indonesia and EU.
“I think for Indonesia, under the trade agreement we agree that two commodities, namely CPO and PKO will be charged with zero percent tariff. We also agree the quota, for CPO around one (1) million tons and for PKO, I think will depend on the volume of our PKO export last year to EU,” said Airlangga.
But Minister Airlangga said that so far there has been no plan of biodiesel export to EU under the IEU-CEPA. “Regarding the biodiesel, we haven’t yet discussed it, as currently we don’t export biodiesel. We only produce the biodiesel for domestic consumption” he said.
Having a total population of more than 285 million people, Indonesia offers a potential big market for EU. On the other side, EU member countries have a total population of more than 400 million people and stands as one of the global economic powers. (*)
