Jakarta. After nearly a decade of negotiations, the Indonesia–European Union Comprehensive Economic Partnership Agreement (IEU-CEPA) is moving toward its final stage ahead of signing and ratification, marking a significant milestone in economic relations between Indonesia and the European Union.

The agreement is expected to strengthen market access, attract investment and expand trade and economic cooperation between the two sides.

The government’s commitment to overseeing the completion of IEU-CEPA was highlighted during a high-level Indonesia–EU Dialogue led by Chief Economic Affairs Minister Airlangga Hartarto in Jakarta on Friday. The meeting, attended by ambassadors and representatives of EU member states, discussed progress on the agreement and the steps needed to ensure it delivers tangible benefits for businesses and both economies once implemented.

“The meeting took place one day after Coordinating Minister Airlangga received Germany’s Minister for Economic Cooperation, accompanied by 15 energy companies. The strong interest from European businesses demonstrates the significant potential for stronger economic ties and investment between Indonesia and the EU through IEU-CEPA,” said Haryo Limanseto, spokesman for the Coordinating Ministry for Economic Affairs.

Preparing for Signing and Ratification
Haryo said Indonesia’s ambassador to the EU had reported that the IEU-CEPA text is currently with the Council of the European Union. Taking into account the summer recess in Brussels and its impact on the EU’s institutional agenda, the agreement is projected to be signed in late September or early October 2026.

Following the signing, the agreement will be submitted to the European Parliament for ratification. Based on the precedent of the EU-Mexico agreement, the fastest ratification process could take around 90 days.

Based on these developments, the Indonesian government is optimistic that IEU-CEPA can enter into force in early 2027.

The timeline is particularly important because the European Union’s Generalized System of Preferences (GSP) facility for Indonesia is scheduled to expire at the end of 2026. Indonesian businesses have called for IEU-CEPA to take effect before the GSP expires to ensure continued market access and greater certainty for exporters.

EU Urges Indonesia to Prepare for Implementation
During the dialogue, EU ambassadors and representatives also expressed support for accelerating the ratification process. Beyond ratification, European partners stressed that effective implementation will be critical to ensuring businesses can fully benefit from the agreement.

Their recommendations included removing business barriers, improving transparency and predictability in procurement and tender processes, and simplifying procedures that continue to pose challenges for companies.

Several EU member states also highlighted non-tariff barriers, including halal certification, Indonesian National Standards (SNI) and domestic component requirements (TKDN).

The meeting also addressed the readiness of Indonesia’s technical ministries in areas including customs, standardization and certification, as well as mechanisms for handling import recommendations for agricultural products once IEU-CEPA takes effect.

Several EU member states also outlined upcoming bilateral economic engagements. Bulgaria is scheduled to send its deputy prime minister to Indonesia on Sept. 14, while Greece plans to send its deputy foreign minister in October to launch the first Joint Committee on Indonesia-Greece Economic Cooperation. Finland’s trade minister is also scheduled to return to Jakarta in October, following a meeting with Airlangga in Paris in June.

Indonesia Establishes Integrated Implementation Mechanism
In response to these recommendations, the Indonesian government has prepared several concrete measures to support the effective implementation of IEU-CEPA.

President Prabowo Subianto has assigned a de-bottlenecking team under the coordination of the Coordinating Ministry for Economic Affairs to address obstacles faced by businesses. Through the mechanism, companies will be able to raise issues directly, with the government coordinating solutions with the relevant ministries and agencies.

The government will also appoint an official at the Coordinating Ministry for Economic Affairs as the single contact point for IEU-CEPA implementation. The official will serve as a central coordination point connecting EU partners with Indonesia’s technical ministries and coordinating issues that emerge during implementation.

Meanwhile, the Trade Ministry is accelerating the preparation of implementing regulations for IEU-CEPA across ministries. The government also plans to maintain coordination channels with businesses to address technical issues as they arise.

The Industry Ministry will coordinate efforts to resolve issues related to SNI and TKDN. The government is also preparing to address matters related to the EU Deforestation Regulation (EUDR), the EU’s steel policies and the Carbon Border Adjustment Mechanism (CBAM).

On food and agriculture, the Coordinating Ministry for Food Affairs will ensure that Indonesia’s commodity balance policy is aligned with the full implementation of IEU-CEPA.

Indonesia is also encouraging the EU to reconsider the EUDR risk classification for several Indonesian commodities, including cocoa and palm oil, with the aim of moving them from the high-risk to low-risk category.

As part of its EUDR preparations, Indonesia has developed digital certification and geolocation data systems for palm oil to meet traceability requirements in the EU market.

Strengthening Government-Business Collaboration
The business community has also called for stronger coordination mechanisms as part of preparations for IEU-CEPA implementation.

Proposals include establishing a joint technical task force involving governments and businesses from both sides to identify and address standardization, certification and procedural issues before the agreement takes effect.

Businesses have also proposed establishing bilateral trade and investment promotion platforms with individual EU member states. Such an approach would allow promotion efforts to be tailored to the distinct characteristics and sectoral opportunities of each market.

Businesses have identified several challenges that will need to be addressed, including dependence on imported raw materials that could affect compliance with Rules of Origin requirements.

Other challenges include non-tariff measures such as CBAM and EUDR, which will not automatically disappear once IEU-CEPA takes effect, as well as the need for domestic structural reforms to reduce business costs and improve compliance with international standards.

At the close of the dialogue, Haryo said Airlangga also expressed appreciation to EU Ambassador to Indonesia Denis Chaibi, who is set to conclude his posting in Jakarta after helping oversee the IEU-CEPA negotiations for years.

Airlangga also sought support from EU member states for Indonesia’s bid to join the Organisation for Economic Co-operation and Development (OECD).

“The Indonesian government emphasizes that the completion of IEU-CEPA is an important achievement that must be followed by close cooperation during the implementation stage,” Haryo said.

“With the support of all stakeholders, IEU-CEPA is expected to serve as a strategic instrument to expand market access, increase investment, strengthen competitiveness and foster stronger, mutually beneficial economic relations between Indonesia and the European Union.”

The dialogue was also attended by the trade minister, deputy industry minister, Indonesia’s ambassador to the EU via videoconference, representatives of the Coordinating Ministry for Food Affairs, Indonesian Employers Association (Apindo) chairman and representatives of the Indonesian Chamber of Commerce and Industry (Kadin).

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