Ref. Ares(2019)1598515 - 10/03/2019
SOM IDN – EU
Brussels, 7 December 2010
Vision Group – conclusions of first meeting
Objective To inform SOM about the positive developments (since Presidents’ meeting)
regarding the Vision Group to enhance trade and investment, main issues and
concerns discussed and ambitions expressed by Minister of Trade, Pangestu.
Both sides have a lot to gain from a strengthened relationship and seem to go
for a positive advice (regarding benefits of potential agreement) by June 2011.
Even though EU is the second largest export partner for Indonesia and
arguably the largest source of investments, the relative share of EU in
terms of Indonesia’s trade and investment is dropping from 18% to 14%
and EU investments only represent 1.5% of EU investments to Asia.
When our leaders met last year they saw the above as an opportunity: our
trade is complementary and EU investors can provide valuable support to
Indonesian economy, in terms of technology, value chain and jobs.
A group of eminent persons was formed, with reputable co-chairs (4.1(b
) and members from different line ministr)ies,
academics and private sector, tasked to have a discussion and analysis of
how trade and investments could be enhanced and look at various
options, including a Comprehensive Economic Partnership Agreement.
Minister of Trade Pangestu welcomed and discussed with the VG,
showing high ambition and expecting results by June 2011 arguing that:
o EU and Indonesia trade is complementary and there are substantial
opportunities by increasing our relationship through an agreement.
o An agreement should be comprehensive and include trade
liberalization, trade facilitation and capacity building.
o IDN interest lies in helping SMEs trade and invest and deal with
concerns such as fisheries, palm oil and green economy, but also
benefits of increasing share of services to Indonesia.
Potential benefits of an Agreement (arguably 1.8% welfare gain for IDN,
as well as structural gains of economy). A recently completed study
shows that IDN has great potential in sectors such as traditional cosmetics
(jamu) and furniture and could be supported under the EU’s cooperation
Some members brought forward IDN concerns with EU, mostly in terms
of difficulties applying to standards, but also highlighted good examples
such as fisheries where EU supports IDN to fulfill those standards.
In terms of comprehensiveness, some members argued that services and
investment should be included and trade facilitation considered more
important than liberalization, also in view of helping Indonesian produce
increase value chain. Challenges and opportunities of current
infrastructure and land access and ways EU could contribute to be
considered, through economic cooperation. The FTA with Japan can be
an example, while arguing Indonesia should not depend too heavily on
China and Japan alone.
Deliverables, tasked to members, and agenda for February, include:
o Recommendations for IDN-EU in terms of current FTA examples
o Concept of a “comprehensive” CEPA and how to structure an
effective dialogue mechanism between government and KADIN,
o Provide a paper regarding measures to attract EU investors
o Ways of identifying and dealing with losers, and losing sectors.
o Communication strategies and consultations with stakeholders to
mobilize support for new trade and cooperation arrangements
o Possible pilot projects in trade & investment regulatory reform.
The next meeting will include some of these technical issues;
It is to be expected – with the positive attitude and dynamics of this group
– that the deadline of June is feasible and that constructive
recommendations will be delivered.
EU Delegation Jakarta
5 December 2010
Background Vision Group
Vision Group to enhance trade and investment between Indonesia and EU was initiated in
December 2009 when President Yudhoyono met President Barroso. Minister of Trade
Pangestu appointed 11 members for the Indonesian part coming from different line
ministries, private sector (chamber of commerce Kadin) and academics. A first meeting on
modalities specified the Terms of Reference, as well as the way this Vision Group would
work – namely based on the intelligence and experience of the vision Group members, aided
by existing studies and backgrounds existing. It was agreed that this group should focus on
opportunities more than obstacles and to advise the governments by June 2011. The first
meeting on substance took place on 2 December in Jakarta, co-chaired by 4.1(b)
(CEPS Brussels) and 4.1(b)
, (Prasetiya Mulya Business School).
First discussions were based on a number of studies and presentations, including
opportunities for EU in Indonesia and vice versa, potential benefits of an FTA, views from
business, existing arrangements as well as the Partnership and Cooperation Agreement,
ongoing and planned economic cooperation. Indonesia members commented on issues such
as the need for more assistance regarding EU standards and policies; possible options
including defining ‘comprehensive’ and how to deal with potential losers of a trade deal. 4.1(a)
A very positive sign of commitment was the welcome by Minister Mari Pangestu and
discussion on goals and ambition: Pangestu argued that the EU and Indonesia are compatible
in terms of trade and industry and welcomed the idea – following among others the
recommendations of the EU Indonesia Business Dialogue, of a mechanism to dialogue with
business and government in an integrated way, focusing on opportunities that go beyond
trade and investment alone. 4.1(a) and 4.3
A CEPA should be
win/win, with for IDN benefits related to REACH, RED, fisheries, as well as climate change
and green economy. It should furthermore help SMEs to easier fulfill standards and NTBs.
Previous meetings (EU Indonesia Business Dialogue and Working Group on Trade and
Invesmtent) were reported on and recommendations shared, Kadin arguing especially that
vision group advice should be followed up swiftly, considering the political developments
towards the next general elections in Indonesia (mid 2014).
Follow up actions have been defined and the following meeting is scheduled for 22/23
February 2011 in Brussels.
Terms of Reference of the Vision Group
Members of the Vision Group
Agenda of the first meeting
ANNEX: TOR VISION OF ENHANCING EU-INDONESIA TRADE AND INVESTMENT
When the Indonesian President Susilo Bambang Yudhoyono met with the European Commission
President José Manuel Barroso in December 2009 they discussed ways of enhancing our bilateral ties.
The two Presidents agreed that trade and investment is an area where the bilateral relationship has
great potential to develop, and on the need to explore ways to strengthen these ties. The two leaders
decided to set up a "Vision Group"
that will examine how to increase trade and investment between
Indonesia and the EU. The expected output is a strategic paper (vision) with recommendations to
Ministers (including on the potential for a comprehensive Free Trade/Economic Partnership
Agreement). This Group should be constituted by eminent persons from both sides consisting of
members of the respective Governments, business and academia.
The Specific Objectives of the Vision Group are:
To provide a strategic view of EU-Indonesia trade and investment relations and identify on
EU-Indonesia trade and investment relationship can best be enhanced in an
To identify opportunities for fostering trade and investment between EU and Indonesia,
bearing in mind the market characteristics and potential, evolution of bilateral flows and the
challenges for realisation of this potential
To provide recommendations to relevant parties (GoI, EU, business community, academia)
for the full realisation of this trade and investment potential
In this context, to explore the feasibility of a Free Trade/Economic Partnership Agreement
between EU and Indonesia.
Annex: Recommendations EU Indonesia Business Dialogue, as presented by the Indonesian
Chamber of Commerce, Kadin)
1. EU and Indonesia to focus more on opportunities
a. develop a vision to ensure our trade and investment relations reach the next level of
2. EU and Indonesia should pave the way towards a comprehensive partnership agreement
3. EU and Indonesia to put in place a mechanism to improve transparency and consultation on
4. EU and Indonesia to improve regulatory cooperation through improved communication and
a. business should be integrated in this dialogue
5. EU to support Indonesia through cooperation and technical assistance:
a. To make regular impact assessments on draft regulations
b. Capacity building for implementing regulations
c. To implement international standards in key sectors such as UNECE standards for
d. To develop better understanding on EU laws and regulations including SPS measures,
REACH, FLEGT and RED
e. Capacity building to help meet EU requirements
f. To develop capacity building programs for new market opportunities in cosmetics and
6. Indonesia to cut red tape in areas such as mandatory certification and registration system for
industrial and food products
a. Give specific attention to easing requirements on SNI
b. Facilitate registration and labeling in Bahasa Indonesia of agro food products
7. Indonesia to improve the investment climate in key areas including infrastructure, medical
and pharmaceuticals and ensure better protection of IPR
a. Review the negative list on pharmaceutical sector
b. Enforcing stronger PPP agenda and its regulatory framework
c. Implementation of land acquisition and government guarantee funds policies should
be done dealt soon sand effectively.
8. Mechanism and processes for business and government cooperation in Indonesia.
strengthen the communication on trade and investment challenges and opportunities between
the GoI and the business sector, represented by Kadin and the European chambers in
Indonesia, it is recommended that:
a. Specific focal points be nominated in the MoT, BKPM and other relevant agencies
and in the business sector to prepare and handle issues
b. A regular and structured mechanism for consultation be established between business
and government, facilitated by the focal points, that will provide a clear and
constructive interface for consultation.
EU-Indonesia Vision Group
First Meeting – Jakarta 2nd December 2010
9.00 – 9.30
Opening and presentation of the objectives of the group, expected
timeframe and working method.(Co-Chairs of the Vision Group)
9.30 – 12.00
State of play of EU-Indonesia trade and investment relations:
9.30 – 10.15
Presentation of three studies (Project Group)
Trade and investment between EU and Indonesia: Opportunities and
Indonesia market access to the European Union: Opportunities and
Trade Sustainability Impact Assessment of the FTA between the EU and
ASEAN with summary of the main issues related to Indonesia
10.15 – 12.00
Tour de table/brainstorming (Co-Chairs moderate the discussions also on
the basis on the material received from the Project Group)
12.00 – 13.00
The view of the business sector: presentations by KADIN and EuroCham
on the basis of the outcome of the second meeting of the EIBD
13.00 – 14.00
14.00 – 14.45
Presentation on different models of bilateral agreements and the
approaches to measure the economic benefits (
14.45 – 15.15
What we have already in place: Short overview of the Agreements of
Indonesia and the EU with third parties (Project Group)
15.15 – 16.00
16.00 – 16.20
The Partnership and Cooperation Agreement between EU and Indonesia:
main content and timeframe for implementation including comparison
with the Indonesia-Japan EPA (European Commission)
16.20 – 16.40
Overview by EU on bilateral and regional economic cooperation
activities and by Indonesia on currently foreseen needs (EU Delegation &
Ministry of Trade)
16.40 – 17.30
Second tour de table/brainstorming
17.30 – 18.00
Discussion on further analytical work to be completed
18.00 – 18.30
Conclusions and agreement on date and agenda of next meeting
19.00 - 21.00
Contact List of Vision Group & Project Group
Pages 7 to 8 are entirely covered by art. 4.1(b) and were thus removed from the document.