POLITICAL & ECONOMIC RELATIONS
The European Union (EU) and Indonesia have made significant strides in building a modern, outward-looking partnership. This is rooted in thriving trade links, a shared attachment to advancing democracy and human rights, action on climate change and terrorism at home and abroad and expanding people-to-people links. The strategic interests at the heart of the relationship include:
- Indonesia is an emerging economic and commercial giant, a member of the G20 with sustained growth expected to reach 7% and an increasingly appealing climate for investors. The country enjoys a strategically attractive location: over half of world trade passes by its northern maritime border.
- A powerhouse in ASEAN: with 40% of the population and 35% of the economy, Indonesia is taking a natural lead in the bloc and is a crucial actor in the long term stabilisation of the region.
- Indonesia is the largest Muslim-majority country in the world. It is the most democratic country in the region with an increasingly positive human rights track record.
- Cooperation with Indonesia is crucial in order to tackle climate change. Indonesia is the third largest emitter of greenhouse gases and is a natural partner in finding global solutions.
Our shared interests and commitment to closer collaboration are now encapsulated in the EU-Indonesia Partnership and Co-operation Agreement (PCA) [234 KB] signed in November 2009. The PCA paves the way for closer co-operation in a wide range of fields, including trade, environment, energy, education, science and technology, migration and counter-terrorism. Our co-operation is broadening and deepening through:
- Efforts to boost trade flows, investment and market access, including through work towards an ambitious Comprehensive Economic Partnership Agreement covering trade, investment and services.
- A new EU-Indonesia Human Rights Dialogue launched in 2009 to intensify exchanges on questions of mutual interest.
- Enhanced people-to-people links, including through the Erasmus Mundus scholarship programme , improved access by Indonesia to EU Research and Development opportunities and increased tourism.
- Development of intercultural exchange and engagement with moderate Islamic groups.
This reinforces the substantial EU development co-operation programmes in Indonesia , which furnish support to: Indonesia's reform process in the areas of democratisation, human rights, good governance; poverty reduction, including education; improvement of the trade and investment climate; tackling environmental problems and promoting ASEAN cooperation.
In addition, the EU has supported Indonesia in areas posing specific political challenges. The EU's contribution to the Aceh peace process illustrates the close ties between EU and Indonesia. The EU funded mediation talks and deployed the Aceh Monitoring Mission to oversee the implementation of the peace agreement and contributed nearly € 30 million to help ensure the long-term stability of the peace process.
Economic and political dialogue between Indonesia and the EU takes the form of regular Senior Officials Meetings. As political relations are deepening, new structures for political engagement will be put in place once the PCA enters into force following ratification by EU Member States and Indonesia.