JAKARTA – Indonesian Coordinating Minister for Economic Affairs, Airlangga Hartarto, has announced that the World Trade Organization (WTO) has issued a ruling supporting Indonesia’s position on several key claims in a dispute with the European Union (EU). The case concerns the EU’s imposition of countervailing duties on Indonesian biodiesel imports, a conflict that began in 2023.
Airlangga welcomed the ruling as a positive development. “This is good news for the advancement of Indonesia’s key export commodity. The WTO panel supports Indonesia in its decision regarding the imposition of dumping duties on biodiesel in Europe,” he stated at his office in Jakarta on Saturday, August 23, 2025.
In its decision, the WTO Panel recommended that the EU bring its measures into compliance with its obligations under the Agreement on Subsidies and Countervailing Measures (SCM Agreement). The EU is a crucial market for Indonesian palm oil and biodiesel products.
According to Airlangga, the WTO ruling will also help ensure fair market access for Indonesia’s key exports. The Indonesian government is now awaiting the EU’s response to the ruling. “We, Indonesia, are just waiting to see how the European Union responds to the WTO Panel’s decision,” he added.
Waiting for response
The Indonesian Palm Oil Association (GAPKI) Chairman Eddy Martono warmly welcomed the WTO decision, saying that it will strengthen Indonesian palm oil position at the global market. “It’s very positive for our palm oil industries. But palm oil industry players are waiting for the response of EU on that decision. We’ll see whether they will file an appeal or they will accept the decision,” Eddy said on Sunday (24/08/2025).
Eddy added that EU is now the third largest importer of palm oil from Indonesia, after China and India, with total import volume of 3–4 million tons per year. But its biodiesel export to Europe is relatively small as most of its biodiesel production is absorbed at local market for mandatory biodiesel program.
“EU’s biodiesel import has decreased as they had started producing biodiesel by using used cooking oil (UCO), rapeseed, sunflower, soybean, and palm oil as raw materials,” said Eddy.
GAPKI Secretary General M. Hadi Sugeng Wahyudiono said that the WTO decision has opened a new opportunity for palm oil-based biodiesel of Indonesia to reenter the European market.
“Indonesia’s biofuel policy does not violate the principles of international trade. The WTO decision has proven that the EU accusation against Indonesia is not true,” said Hadi.
Eddy also highlighted the trade agreement of Indonesia–European Union Comprehensive Economic Partnership Agreement (IEU–CEPA), which can provide big opportunity for annihilation of non-tariff barriers for Indonesian goods, including palm oil. But he said that currently the biggest threat for Indonesian palm oil could come from the implementation of European Union Deforestation Regulation (EUDR), which will be made effective since December 2025.
“If Indonesian palm oil does not comply with the EUDR, it will affect its palm oil exports. Companies are relatively more prepared, but smallholders are not yet. If the smallholders’ palm oil cannot comply with the regulation, companies that buy their product could face problem,” said Eddy.
Eddy emphasized the importance of internal improvement, including the acceleration of getting documents of cultivation registration for smallholders. “This is important for Indonesia so that it can repeat its success when the EU finally admitted the scheme of Indonesia Sustainable Palm Oil (ISPO),” he said. (*)
Stable Economic Growth
Airlangga claimed that Indonesia has been able to maintain a stable economic growth of 5 percent. In the second quarter of 2025, the Central Statistics Agency (BPS) reported that the economy grew by 5.12 percent year-on-year.
He asserted that this consistent performance makes Indonesia a leader in the Southeast Asian region. “No other country has consistently grown 5 percent. ASEAN leaders always look to Indonesia. Indonesia is a point of reference,” he said.
Previously, Airlangga noted that Indonesia’s economy is currently only behind China’s, which is growing at 5.2 percent. In comparison, other ASEAN countries like Malaysia and Singapore are growing at 4.50 percent and 4.30 percent, respectively, while the United States is at 2.00 percent.
He also dismissed allegations of data manipulation, addressing doubts raised by some parties regarding the BPS’s economic growth data for the second quarter of 2025. (*)
