German Ambassador Optimistic Indonesia-EU Trade Deal Will Proceed Smoothly
The German Ambassador to Indonesia, Ralf Beste, is optimistic that the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA) can soon enter the ratification stage and come into force by 2027.
According to Beste, support for the trade agreement, which has been negotiated for many years, is quite strong in both Europe and Indonesia. Consequently, he does not foresee any major obstacles that could disrupt the ratification process.
“I am quite optimistic that the ratification process can proceed this year. Of course, it depends on the parliaments of both parties, namely the European Parliament and the Indonesian Parliament,” Beste said during a press conference at the German Embassy in Jakarta on Friday (12/06/2026).
He added that, unlike several other trade agreements that have sparked debate in Europe, the IEU-CEPA is receiving widespread support from various political groups within the European Union.
“There is a broad majority in Europe that supports a bilateral trade agreement with Indonesia. This is not a controversial agreement. I also see significant support from the Indonesian side, so there is nothing that concerns me,” he stated.
Beste noted that if the ratification process proceeds as planned, the IEU-CEPA could take effect in 2027. The implementation of the agreement is believed to act as a new driver for increasing trade and investment between Indonesia and European Union nations, including Germany.
One of the primary benefits for businesses will be the removal of most trade tariffs. According to him, approximately 98% of tariff lines will be gradually reduced to zero per cent over a 10-year period after the agreement takes effect, with certain exceptions to protect specific interests of both parties.
Furthermore, Beste assessed that the greatest impact of the IEU-CEPA could stem from increased investment flows. Greater regulatory certainty and a clearer framework will encourage European companies to expand their businesses in Indonesia, while simultaneously opening greater opportunities for Indonesian investors to enter the European market.
“What we are doing now is informing the business community about the opportunities that will open up. This is not just about trade, but also investment,” he said.
He added that the agreement would also facilitate cross-border business activities, including access to financial services and the financing required by investors.
“We want to attract more Indonesian investors to Germany and also encourage more German companies to come to Indonesia. This agreement provides greater confidence for business actors to invest and trade,” he remarked.
Currently, Beste noted, there are already hundreds of German companies operating in Indonesia. Some companies even use Indonesia as a production base to serve the Southeast Asian market.
With the implementation of the IEU-CEPA, Germany hopes that Indonesia will become an even more attractive destination for regional investment, while strengthening the position of both regions as strategic economic partners.
“We hope that the IEU-CEPA will be a further step in building more trust and certainty that Indonesia is a good place to do business,” said Beste.