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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


’Indonesia set for a fall in free trade era’
Indonesia will not be able to take advantage of increasing world trade liberalization because many stakeholders here are not even aware it is going on, an official says.
Indonesia happy with CAFTA with China, sees no need for FTA
Indonesia will not seek to sign bilateral agreements with China outside the China-Asean Free Trade Area (CAFTA) scheme when President Susilo Bambang Yudhoyono visits that country later this week.
US, Indonesia build on Trade and Investment Agreement
US and Indonesian officials met in Washington June 20-21 for the second time in three months to discuss ways to deepen their trade relationship, according to a June 22 press release from the Office of the US Trade Representative (USTR).
Indonesia may only need FTA with Japan, Australia, US: Economist
A leading economist said Indonesia does not necessarily seek to have free trade agreement (FTA) bilaterally with many other countries.
FTA deal on course
Australia and Indonesia will develop a framework that could provide the building blocks for a free trade deal between the two countries
Deiss calls for trade accord with Indonesia
Swiss Economics Minister Joseph Deiss, ending a trade visit to southeast Asia, has invited Indonesia to enter an agreement with the European Free Trade Association.
Towards a US-Indonesia free trade agreement
This May 2004 paper examines the main issues in designing an FTA between Indonesia and the United States.
Indonesia, US revive bilateral trade and investment talks
Indonesia and the United States met and revived bilateral talks on trade and investment here on Friday — a move that could lead to free trade negotiations between the two countries.
Indonesia and bilateral trade agreements (BTAs)
Paper presented to the APNFS workshop on Regional & Bilateral Trade Agreements & Looking at Agriculture Subsidies in the North: Common Advocacies for Food Sovereignty (November 2004)
The benefits and dangers of bilateral FTAs for Indonesia
It might be that the best path of all for the Indonesian government to reassess its commitment to pursue free trade. Bilateral FTAs are nothing more than hidden tools used to secure the privileges and the wealth of multinational corporations and to advance the interests of powerful governments.