Indonesia-European Union Comprehensive Economic Partnership Agreement (I-EU CEPA)
Introduction
The Indonesia-European Union Comprehensive Economic Partnership Agreement (I-EU CEPA) is a landmark agreement that was signed on October 18, 2018, and entered into force on August 1, 2021. This agreement is the most comprehensive and ambitious trade agreement ever negotiated by the European Union with a Southeast Asian country. It covers a wide range of areas, including trade in goods and services, investment, intellectual property, and sustainable development.
Key Features of I-EU CEPA
- Tariff Reduction: I-EU CEPA eliminates tariffs on 99% of goods traded between the EU and Indonesia. This will significantly reduce the cost of doing business and boost trade flows between the two regions.
- Services Liberalization: I-EU CEPA opens up the services sector in both the EU and Indonesia. This will allow businesses to provide a wider range of services in each other’s markets.
- Investment Protection: I-EU CEPA provides strong protection for investors from both the EU and Indonesia. This will encourage investment and create new jobs in both regions.
- Intellectual Property: I-EU CEPA includes provisions to protect intellectual property rights, such as patents, trademarks, and copyrights. This will help to promote innovation and creativity.
- Sustainable Development: I-EU CEPA includes a chapter on sustainable development that commits both parties to promote sustainable practices in trade and investment.
Benefits of I-EU CEPA
I-EU CEPA is expected to bring a number of benefits to both the EU and Indonesia, including:
- Increased Trade: I-EU CEPA is expected to increase trade flows between the EU and Indonesia by up to €15 billion per year.
- Economic Growth: I-EU CEPA is expected to boost economic growth in both the EU and Indonesia. The EU is Indonesia’s second largest trading partner, and Indonesia is the EU’s 15th largest trading partner.
- Job Creation: I-EU CEPA is expected to create new jobs in both the EU and Indonesia. The agreement will make it easier for businesses to operate in each other’s markets, and this will lead to increased investment and job creation.
- Consumer Benefits: I-EU CEPA will benefit consumers in both the EU and Indonesia by giving them access to a wider range of products and services at lower prices.
Conclusion
I-EU CEPA is a landmark agreement that will have a significant impact on the economic relationship between the EU and Indonesia. The agreement will boost trade, investment, and economic growth in both regions. It will also create new jobs and benefit consumers by giving them access to a wider range of products and services at lower prices.
