Jakarta. A European Union (EU) envoy said Thursday that the bloc’s relations with Indonesia transcend trade and environmental regulations despite the prolonged trade deal negotiations and the anti-deforestation law stealing the spotlight in their bilateral engagements.

Indonesia is currently trying to close the comprehensive economic partnership agreement (CEPA) with the EU by next month. Negotiations for this overdue trade pact have been ongoing for eight years. At the same time, Indonesia has expressed serious concerns over the EU Deforestation-Free Regulation (EUDR), which can restrict its palm oil from entering the European market. Amidst Indonesia’s disagreement, EUDR never fails to rise up as a topic of discussion whenever government officials of both sides meet.

However, the CEPA negotiations and the environmental policies are not the only things that can describe the bilateral relations, according to EU Ambassador to Indonesia Denis Chaibi.

“Our most significant engagement is in trade. We are doing intensive trade negotiations,” Chaibi said in Jakarta, acknowledging that the EU’s environmental regulations were also a pivotal issue in their bilateral interactions.

“But Indonesia-EU relations are much bigger than just trade and the environment,” he added.

Chaibi then went on to say that the EU had been supporting many Indonesian youth in scholarship programs.

He also talked of the $20 billion climate financing package: the Just Energy Transition Partnership (JETP). The EU and some of the bloc’s member states --which are JETP Indonesia donors -- plan on mobilizing $2.5 billion under the JETP. From this amount, the European Investment Bank has pledged to provide up to €1 billion (around $1.1 billion) in loans to help Indonesia decarbonize its power systems. The EU also vowed to earmark €25 million in grants and technical assistance. 

According to Chaibi, the EU’s de facto capital Brussels recently hosted visits by Indonesian delegates to learn more about renewable power generation as part of the JETP.

“We have organized visits to show Indonesian officials to give ideas on how renewables can feed Indonesian electricity grids. … We have had technical meetings to compare the maps of forests to make sure we have the same data when discussing deforestation,” Chaibi said, while adding that Indonesia-EU ties had matured based on “engagements, exchanges, and respect”.

Indonesia-EU trade totaled $30.8 billion in 2023 with exports from the Southeast Asian country amounting to $16.7 billion. The EUDR-affected palm oil was among Indonesia’s top exports to Europe. 

The EUDR mandates geolocation coordinates of where the palm oil is produced to prove that it does not grow on deforested land. Coffee and timber, among others, are also subject to this policy. The EUDR will officially come into full effect on Dec. 30, 2024.