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Indonesia

Indonesia signed a major comprehensive FTA with Japan in 2007. In February 2012, it signed a preferential trade agreement with Pakistan which the two governments intend to turn into an FTA. But the Pakistan government has reportedly refused to start new negotiations until its concerns on the existing agreement are addressed.

Right now, Indonesia is negotiating trade deals with Australia, Chile, EFTA (European Free Trade Area), the European Union, Korea, India and Ukraine. It has also expressed an interest to join the Transpacific Partnership (TPP) and to establish a free trade zone with the Eurasian Economic Union. Since 2012, Jakarta is part of the controversial Regional Comprehensive Economic Partnership (RCEP) talks with the nine other ASEAN (Association of South-East Asian Nations) governments and their six FTA partners: Australia, China, India, Japan, New Zealand and South Korea.

As member of ASEAN, Indonesia is also party to the group’s FTAs with Australia and New Zealand, China, India, Japan and Korea, as well as the ASEAN Economic Community.

Following a growing discontent against the investor-state dispute settlement (ISDS) mechanism, whereby foreign investors can seek compensation in an arbitration tribunal if new laws or regulations negatively affect their investment potential, Indonesia decided in 2014 to phase out 67 of its bilateral investment treaties. The government has terminated 20 treaties so far and has been developing a new model BIT that would supposedly reflect a more balanced approach between the country’s right to regulate and foreign investor protection.

last update: October 2016


Private sector ‘to play’ role in the future of free trade
An attempt by the private sector to expand business activities worldwide will determine the implementation of free trade agreements in the globalization era, an economist said Thursday.
Unbalanced power in trade
The EU and ASEAN states have been discussing the possibility of signing a Free Trade Agreement since 2007. Thankfully, the Indonesian government has decided that another one to two years is needed to fully investigate the effects of the FTA before signing.
RI, EU eyeing ‘ambitious’ free trade agreement
Indonesia and the European Union (EU) have agreed to commence talks on an “ambitious” free trade agreement (FTA), as both parties seek to boost two-way trade and EU investments in Indonesia.
Indonesia, EU seek ’ambitious’ free trade agreement
Indonesia and the European Union (EU) have agreed to commence talks on an “ambitious” free trade agreement (FTA), as both parties seek to boost two-way trade and the EU’s investments in Indonesia.
RI should speed up FTA talks with India: Gapki
The Association of Indonesian Palm Oil Producers has called on the government to speed up negotiations of a free trade agreement with India to protect Indonesia’s palm oil market following last week’s India-Malaysia free trade agreement.
Iran, Indonesia hold first Preferential Trade Agreement negotiation
The First meeting of the Trade Negotiation Committee between Iran and Indonesia was held in Medan, the capital of the North Sumatra Province of Indonesia.
Asian regionalism and RI’s comparative advantage
Undeniably, we’re heading towards the globalization of world trade. At the same time countries face challenges other than globalization: regionalism and bilateralism. Indonesia simultaneously faces different levels of trade liberalization, whether at the global (World Trade Organization or WTO), regional (ASEAN Free Trade Area or AFTA) or bilateral level (such as with Australia).
Government agrees to speed up free trade talks with Australia
Indonesia has agreed to speed up the free trade talks with Australia to have the agreement in place soon, Trade Minister Mari Elka Pangestu said today (20/7).
Govt to go ahead with free trade deal with India
The Indonesian government will go ahead with the implementation of a free trade agreement with India despite strong opposition from local industries about a similar trade deal with China early this year, says a senior trade official.
Indonesians discontent with free trade agreements
It is believed that the Indonesian government is not fully aware of the consequences or obligations it accepted when it ratified the ASEAN-China FTA. For example, there was barely any published feasibility study of commitments undertaken within the ACFTA or public hearings before the agreement was ratified.