IC-CEPA Enters New Phase: Indonesia and Chile Accelerate Investment Cooperation
Indonesia and Chile are entering a new phase in their economic relationship, accelerating negotiations on investment to broaden their partnership after the Indonesia-Chile Comprehensive Economic Partnership Agreement (IC-CEPA) for goods trade took effect in 2019 and services trade began implementation in 2025. The government believes expanding the scope of IC-CEPA will unlock greater trade and investment opportunities while strengthening business ties between the two nations.
Trade Minister Budi Santoso stated that Indonesia and Chile have implemented IC-CEPA in stages according to priority. Following goods and services, both countries are now focusing on concluding the investment negotiations launched in 2024. “We are conducting the IC-CEPA negotiations and implementation in stages based on priority. We hope the investment sector negotiations can be completed intensively through a series of virtual meetings this year. We expect swift, balanced, and long-term oriented results,” Budi said in a written statement.
The government has also proposed establishing a business council to bring together Indonesian and Chilean exporters, importers, and investors, ensuring that IC-CEPA utilisation moves beyond tariff reductions to more concrete business cooperation.
According to data from Statistics Indonesia processed by the Trade Ministry, bilateral trade has shown an upward trend over the past five years. Total trade stood at US$424.6 million in 2021, rising to US$587.5 million in 2022, before correcting to US$494.7 million in 2023 and US$476.5 million in 2024, then rebounding to US$535.5 million in 2025. Overall, bilateral trade recorded a positive growth trend of 2.58% during the 2021–2025 period, supported entirely by non-oil and gas sectors.
Indonesian exports to Chile rose from US$259.4 million in 2021 to US$354.5 million in 2022, dipped to US$312.6 million in 2023, then increased to US$339.9 million in 2024 before surging to US$441.5 million in 2025, marking a five-year growth trend of 10.76%. Conversely, imports from Chile declined from US$233 million in 2022 to just US$94 million in 2025, a downward trend of 15.31%. Key Indonesian exports include motor vehicles, mineral and chemical fertilisers, and footwear, while imports from Chile comprise frozen fish, chemical wood pulp, fertilisers, starch, and wine.
The Indonesian Employers Association (Apindo) noted that IC-CEPA has positively impacted export performance, with exports to Chile soaring nearly 250% between 2019 and 2025. However, Apindo Chairwoman Shinta W. Kamdani said utilisation remains far from optimal, necessitating expanded cooperation and government support. “If this trend can be maintained or improved by expanding IC-CEPA’s scope and increasing education on its use, this trade potential could grow exponentially,” she said.
Shinta highlighted that the two economies are complementary, with Indonesian exports dominated by manufactured goods such as vehicles, footwear, fertilisers, and paper. Future opportunities exist in electronics, machinery, chemicals and pharmaceuticals, plastics, and iron and steel. She also sees potential for strategic supply chains in critical minerals processing, plantation-based food industries, and international trade logistics networks. However, she noted that many Indonesian businesses still view Chile as an unfamiliar non-traditional market, while geographical distance and limited direct logistics connectivity force exporters to navigate complex administrative and shipping processes through multiple transit ports.