On September 24, overseas financial institutions analyzed that the newly reached trade agreement between Indonesia and the EU will hardly impact Indonesia’s economic performance in 2026, with policy dividends to be released with a delay. Currently, the agreement is still under multi-party approval procedures and has not taken effect officially, with full implementation scheduled for January 2027, resulting in an obvious time lag in policy transmission.

According to core clauses, over 90% of Indonesian goods exported to the EU will enjoy zero-tariff access after the agreement takes effect, covering agricultural and forestry products, mineral raw materials, light industrial manufactured goods and new energy supporting products. The policy will greatly reduce the export costs of Indonesian enterprises and enhance the international competitiveness of local products. As a core Southeast Asian economy with rich resource endowments and prominent export advantages, Indonesia will see greatly boosted foreign trade potential from the agreement.

Economists stated that Indonesia’s 2026 economic growth will still rely on three core driving forces: domestic consumption, ASEAN regional trade and mineral exports, with EU trade dividends yet to be realized. In the long run, the zero-tariff policy will upgrade Indonesia’s foreign trade structure, facilitate its in-depth integration into the European market, and consolidate its position as a Southeast Asian foreign trade hub. Meanwhile, it will bring industrial chain supporting opportunities for Chinese enterprises investing and expanding business in Southeast Asia.