The Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA) continues to face significant hurdles, with the European Union's Deforestation Regulation (EUDR) emerging as a major stumbling block, an official said on Wednesday.
Djatmiko Bris Witjaksono, Director General of International Trade Negotiations at the Ministry of Trade, highlighted the ongoing policy disagreements that have prevented the two parties from reaching consensus.
"We're still searching for a mutually agreeable middle ground on several policy matters," he stated.
The EUDR, designed to combat deforestation, poses a particular challenge for Indonesia. The regulation's potential impact on agricultural exports, especially palm oil, has raised concerns within the Indonesian government.
While progress has been made on issues such as tariff reduction, trade facilitation, investment, and transparency, policy-related hurdles—especially those stemming from the EUDR—have significantly delayed the negotiation process.
Despite 19 rounds of talks over nine years, the previously set September 2024 target for IEU-CEPA completion is likely unattainable, Witjaksono said.
The EU deforestation rule's impact on the Indonesia-EU trade deal underscores the complexities and challenges involved in negotiating such comprehensive agreements.
Meanwhile, Coordinating Minister for Economic Affairs Airlangga Hartarto emphasized that the EU should refrain from constantly changing its standards or benchmarks.
He also attributed the incomplete IEU-CEPA negotiations to the recent cabinet reshuffle within the EU.
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