EU-Indonesia free trade deal may potentially be finalized in September, as per Wadephul's expectations - EU-Indonesia free trade agreements potentially gaining approval in September, as per Wadephul's expectations
Germany Supports Indonesia's Potential OECD Accession and Pushes for EU-Indonesia Free Trade Agreement
Germany's Federal Foreign Minister, Johann Wadephul, is currently on a multi-day visit to Japan and Indonesia, where he expressed support for Indonesia's potential accession to the Organisation for Economic Co-operation and Development (OECD) and optimism for the approval of the EU free trade agreement with Indonesia.
Wadephul met with Indonesian Foreign Minister Sugiono and Indonesian President Prabowo Subianto during his visit to Indonesia, which comes amidst tensions in the Indo-Pacific region. He emphasized Jakarta's importance as a partner for Berlin, beyond bilateral relations, and highlighted the ASEAN states' association headquarters, located in Jakarta, as playing a significant role in the region.
The EU free trade agreement between Germany (as part of the EU) and Indonesia, known as the Indonesia–European Union Comprehensive Economic Partnership Agreement (IEU-CEPA), is a comprehensive deal covering trade in goods and services, investment, intellectual property, and sustainable development. The political agreement was reached in July 2025, with formal signing anticipated by September 2025. Ratification by individual EU member states, including Germany, typically takes some time after the formal signing, as is standard for EU trade agreements. The expected approval (ratification) date for the agreement is projected to be in 2027.
Wadephul also met with Japanese Economic Minister Yoji Muto and Japanese Prime Minister Shigeru Ishiba during his visit to Japan. He mentioned that Germany and Indonesia already work together in the areas of energy transition and vocational training. The EU free trade agreement presents an opportunity for increased collaboration between German and Indonesian companies, as representatives of both are expected to meet with Wadephul.
As an emerging economic powerhouse and the world's fourth most populous country, Indonesia stands to gain significantly from the agreement once it takes effect, as tariffs and trade barriers are reduced. Germany, being the largest machinery and automotive exporter in Europe, also stands to benefit from the agreement.
In a move that sparked a furious reaction from Beijing, Wadephul called on all sides to "avoid violence and adhere to international law." This statement was made amidst escalating tensions in the region, particularly in the Taiwan Strait, where Wadephul warned against escalation.
The G20 includes Jakarta as an important partner, according to unspecified sources. The ASEAN states' association, whose headquarters are in Jakarta, plays a significant role in the region, according to Wadephul. He described the EU-Indonesia collaboration as a win-win situation and emphasized Jakarta's importance as a partner for Berlin beyond bilateral relations. The Federal Foreign Minister also stated that he hopes Indonesia will soon join the OECD.
