Executive Summary
2025 will be pivotal for EU-Indonesia bilateral relations. After the European and Indonesian elections in 2024, both sides have new administrations in charge, which presents an opportunity for a fresh start. In recent years, tensions and disputes over the EU’s sustainability measures on deforestation and biofuels, and Indonesia’s domestic policies on raw materials have disrupted bilateral relations. However, the two parties remain engaged in negotiations for a free trade agreement (FTA), aiming to conclude talks in 2025, which will require finding common ground on a number of outstanding issues. The new administrations on both sides now face a choice: to step up diplomatic efforts or let the relationship drift further apart.
This policy brief calls for a pragmatic way forward focused on areas of mutual interest, such as decarbonisation of energy-intensive industries, raw materials and clean technologies. It provides an overview of current relations and the new political priorities on both sides, offering recommendations to rekindle EU-Indonesia relations in the new context. These include concluding FTA negotiations with balanced concessions on sustainability matters and raw materials trade; investing in clean energy production in Indonesia and decarbonisation of mining and processing activities; and extending cooperation on deforestation to emerging drivers, such as mining.