IEU-CEPA Becomes Golden Opportunity for Government to Attract Foreign Investment into Strategic Projects
Jakarta – The government is opening the door to foreign investment in national strategic infrastructure development, including the giant sea wall project, following the achievement of a political agreement in the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA) between the President of the Republic of Indonesia, Prabowo Subianto, and the President of the European Commission, Ursula von der Leyen.
This agreement, which has been under negotiation for nearly a decade, marks a new phase in the economic relations between Indonesia and the European Union. Through IEU-CEPA, both parties have agreed to expand free trade, open markets, and establish a strategic partnership framework that can drive sustainable economic growth.
The Chairman of the Indonesian Chamber of Commerce and Industry (Kadin), Anindya N. Bakrie, described the agreement as a major breakthrough for Indonesia’s international trade.
“This is a breakthrough in Indonesia-EU international trade, which has taken almost a decade of negotiations,” he said.
Throughout 2024, total trade between Indonesia and the European Union reached 30.1 billion USD, or approximately 27.3 billion euros. With the conclusion of the IEU-CEPA agreement, this figure is expected to increase significantly. Kadin views export sectors such as textiles, commodities, and palm oil as having great potential for further growth.
However, beyond the trade of goods, this agreement also opens up opportunities for foreign direct investment (FDI) from Europe into Indonesia, particularly in the infrastructure sector. One of the strategic projects identified is the construction of the giant sea wall as part of a long-term solution to address the threats of climate crisis and rising sea levels in coastal areas, including the national capital.
President of the European Commission, Ursula von der Leyen, stated that the agreement symbolizes Europe’s and Indonesia’s commitment to open and mutually beneficial cooperation amid global uncertainties.
“In difficult times, some choose the path of isolation and fragmentation. But Europe and Indonesia choose the path of openness, partnership, and shared opportunities,” she said.
Meanwhile, Chairman of the Gerindra Party Faction, Budisatrio Djiwandono, noted that IEU-CEPA is not merely a trade agreement, but a crucial milestone that expands market access and attracts quality investment.
“This agreement opens up great opportunities for Indonesia, not only to expand market access, but also to enhance the value-added of domestic industries, create new jobs, and attract more foreign investment,” said Budisatrio.
A non-economic aspect that also received attention is the EU’s visa cascade policy, which will make it easier for Indonesian citizens to obtain multi-entry Schengen visas. This step is expected to strengthen people-to-people connectivity through mobility in education, entrepreneurship, and cultural sectors.
