The EU mainly exports industrial products, including machinery and equipment, means of transport and chemicals to Indonesia. Trade negotiations have faced a challenge on the issue of palm oil following the EU`s decision to eliminate the use of biofuels and biodiesel made from palm oil by 2030. The European Commission, the EU`s executive arm, has classified palm oil as an unsustainable product. The plan has destabilized Indonesia, the world`s largest palm oil-producing country. Indonesia is currently negotiating trade agreements with Australia, Chile, EFTA (European Free Trade Area), the European Union, Korea, India and Ukraine. It has also expressed interest in joining the Trans-Pacific Partnership (TPP) and creating a free trade area with the Eurasian Economic Union. Since 2012, Jakarta has been part of the controversial Regional Economic Partnership (RCEP) with the other nine ASEAN (Association of South East Asian Nations) governments and their six FTA partners: Australia, China, India, Japan, New Zealand and South Korea. Jakarta is also working on a major trade pact with the European Union (EU). The Comprehensive Economic Partnership Agreement between Indonesia and the EU is important, as the EU is the third objective for Indonesian exports, with important export products such as agricultural products, machinery and equipment, textiles and footwear, as well as plastic and rubber products.
This study is an in-depth study of ASEAN and the EU`s plan to create a free trade agreement. Specifically, qualitative and quantitative methods attempt to assess the economic impact of this proposed free trade agreement on one of the ASEAN developing countries, Indonesia. Indonesia and the EU have both improved their bilateral economic relations by signing a Partnership and Cooperation Agreement (PCA) in 2009 covering different areas of cooperation such as trade, investment, human rights and climate change. The PCA with Indonesia is the first agreement of its kind signed by the EU with an Asian country; It thus strengthens Indonesia`s diplomatic image in the eyes of European politics. Although many studies have been conducted to analyse the feasibility of an AEUFTA, little critical research has been conducted on this subject. This study is therefore an initiative to fill this gap. The spread of the corona pandemic is also an obstacle to the trade negotiation process with the government of several partner countries. One of them is that of the trade negotiations of the Comprehensive Economic Partnership Agreement (I-EU CEPA) of the European Union.
Following fruitful exploratory discussions on deepening eu-Indonesia trade and investment relations, negotiations for an EU-Indonesia Free Trade Agreement were launched on 18 July 2016. The aim is to conclude a free trade agreement that facilitates trade and investment and covers a wide range of issues, including tariffs, non-tariff barriers, trade in services and investment, trade aspects of government procurement, competition rules, intellectual property rights and sustainable development. The impact of Corona, Indonesia`s trade negotiations – the European Union disrupted by Rizky Alika He also said that there are about 12 trade deals that are expected to be concluded this year. . . .