The deal will support cooperation on critical raw materials vital for both economies' competitiveness.

European Commission President Ursula von der Leyen announced a political agreement on July 13, 2025, to advance the EU-Indonesia free trade deal, known as the Comprehensive Economic Partnership Agreement (CEPA).

This agreement aims to unlock new markets and create opportunities in key sectors such as agriculture, automotive, and services, with a target to conclude negotiations by September 2025.

He also underscored that the CEPA is not only about trade but also about fairness, sustainable development, boosting industries, and creating jobs in Indonesia.

Negotiations on the free trade agreement have been ongoing since 2016, with the EU and Indonesia aiming to enhance trade, investment, and economic resilience.

Indonesian President Prabowo Subianto highlighted the importance of European involvement in Indonesia's economy, especially during times of global instability, and expressed a desire for increased European engagement.

The strengthening EU-Indonesia relationship is based on shared values such as democracy, human rights, and the rule of law, aiming for a more strategic partnership in the future.

Von der Leyen emphasized that the deal comes at a crucial time to tap into the untapped potential of EU-Indonesia trade relations and strengthen partnerships amid global economic and geopolitical volatility.

Both leaders viewed the agreement as a positive example of cooperation during challenging times and reaffirmed their commitment to a rules-based international order, supporting global peace efforts.

They also agreed on broader bilateral initiatives, including a new visa policy to facilitate easier access for Indonesians traveling to the EU.

The EU is Indonesia’s fifth-largest trading partner, with bilateral trade valued at $30.1 billion in 2024, despite some strains over environmental import policies.

The agreement also emphasizes cooperation on clean energy transition and Indonesia’s energy self-sufficiency through initiatives like the Just Energy Transition Partnership.