Jakarta. Canada sees no issue with Indonesia’s decision to centralize all strategic commodity exports, according to its envoy, as Ottawa awaits the entry into force of a bilateral trade pact.

Under the new one-gate export regime, shipments of coal, ferroalloys, and palm oil have to be routed through the state-run agency Danantara Sumberdaya Indonesia (DSI). This policy is now in its second week and will enter full implementation by early next year. 

Canadian Ambassador to Indonesia Jess Dutton told a press briefing on Wednesday that the government had the “right to implement these kinds of measures”. The policy will not hurt the ongoing trade momentum as Canada doesn’t import the affected commodities from Indonesia in great volumes.

“Through our initial reading, I don’t believe this will impact our trade relationship. We don’t import some of these strategic commodities at great value from Indonesia,” Dutton said in his Jakarta residence.

“I don’t believe the intent [of this new trade scheme] is to reduce the exports of these commodities.”

Official data showed that Indonesia-Canada trade soared from almost $3.6 billion in 2024 to approximately $4.4 billion. Four-month trade of 2026 had declined by roughly 6% year-on-year. Electrical equipment, rubber, and footwear make up the lion’s share of Indonesia’s exports. The Indonesian government has been wanting to increase the palm oil shipments to Canada.

As Indonesia implements its new export regime, Jakarta is inching closer to a trade agreement that will reduce or eliminate virtually all tariffs for Canada-bound goods and vice versa.

According to Dutton, Canada has wrapped up the lawmaking process of this trade accord, dubbed CEPA for Comprehensive Economic Partnership Agreement (CEPA). As the ball rests in Jakarta’s court, the diplomat expects the CEPA to enter into force by the end of this year.

At present, DSI’s scope of work is limited to cross-checking the export reports submitted by the businesses. They will eventually handle the entire export process, including the shipments and payment collection. Indonesia’s top foreign investor Singapore has commented on this policy, saying that countries have their “own concerns and priorities”.

“[We] will work together with Indonesia to ensure Indonesia continues to be an attractive investment destination [for our country],” Singaporean Deputy Prime Minister Gan Kim Yong said in Jakarta a day earlier.

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