Securing access to a new market would be a win for the EU Commission, which is pursuing a trade diversification agenda since relations soured with the US following its imposition of tariffs.
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EU Trade Commissioner Maroš Šefčovič landed in Indonesia on Monday with the hope of closing a trade deal with Jakarta.
“The intention certainly is to finalise political negotiations for an EU-Indonesia trade agreement,” Commission deputy chief spokesperson Olof Gill said.
Last July, Commission President Ursula von der Leyen reached a political agreement with her Indonesian counterpart President Prabowo Subianto, confident of concluding the negotiation in September this year.
By closing such a deal, the EU would secure access to a new market of around 280 million people.
Bilateral trade in goods between EU and Indonesia reached €27.3 billion in 2024, with EU exports worth €9.7 billion and EU imports worth €17.5 billion. The bloc would also strengthen its position in the region, since Indonesia was the EU’s fifth-biggest ASEAN trading partner in 2024.
India considered a 'tough' negotiator
Increasing trade access to new markets has become EU’s top priority following the decision of its historic trade partner the US to impose tariffs on EU imports.
Under a trade agreement reached in July by the Commission and the US administration, 15% tariffs apply to most EU goods, while 50% tariffs continue to apply to imports of EU steel and aluminium.
The EU has since stepped up efforts to strengthen economic ties with the rest of the world.
It reached a political deal with the Mercosur countries - Argentina, Brazil, Paraguay and Uruguay – in December, which if approved by EU member states and MEPs would create a free trade area covering 780 million people.
The Commission is also aiming to finalise a landmark agreement with India this year. The talks have accelerated at the beginning of September with the Agriculture file reaching the negotiation table. But as Šefčovič noted on 12 September, New Delhi is a “tough” negotiator, and a swift outcome is not guaranteed.
