Indonesia‑EAEU Free Trade Deal: What the Next Five Years Could Look Like
Indonesia’s trade minister, Arief Santoso, recently told ANTARA that the new free‑trade agreement (FTA) with the Eurasian Economic Union (EAEU) could “multiply trade up to 100 %.” With zero‑tariff access for Indonesian products in Russia, Kazakhstan, Armenia, Belarus and Kyrgyzstan, the partnership is poised to reshape supply chains across Asia and Eastern Europe.
Zero‑Tariff Boost: The Immediate Winners
Under the draft agreement, Indonesian exporters will enjoy a 0 % tariff on key commodities such as:
- Crude palm oil (CPO)
- Textiles & apparel
- Manufacturing components
- Agricultural produce (including mangoes and shrimp)
- Fishery products
For EAEU members, the deal unlocks a reliable source of food security and raw materials at competitive prices.
Trade Figures That Tell a Story
In 2024, bilateral trade between Indonesia and the EAEU reached **US $4.1 billion**. Indonesian exports rose 36 % to **US $1.5 billion**, while imports fell 4 % to **US $2.4 billion**. The decline in imports reflects Indonesia’s growing self‑sufficiency in wheat and fertilizers—two commodities it traditionally sourced from Russia and Kazakhstan.
Did you know? The EAEU currently imports more than **US $20 billion** of agricultural products annually, making Indonesia a strategic partner for diversifying those supplies.
Sector‑Specific Opportunities
1. Crude Palm Oil – From Sukhum to St. Petersburg
Indonesia accounts for roughly **60 %** of global CPO production. With the tariff barrier eliminated, Russian refiners can secure cheaper feedstock, boosting downstream oleochemical output. Early talks have already identified a pilot shipment of 500,000 tons of CPO to the port of Novorossiysk by mid‑2025.
2. Textiles & Apparel – Fast‑Fashion Meets Eurasia
Indonesian garment factories, already accredited by WTO standards, will find new markets in Kazakhstan’s growing middle class and Belarus’s retail chains. A recent case study showed that a Bandung‑based maker increased its sales to Kyrgyz retailers by **45 %** after a test run of tariff‑free shipments.
3. Fisheries – Sustainable Growth for Coastal Communities
Fresh and frozen seafood from Lampung and East Nusa Tenggara are expected to fill a niche in Armenian supermarkets that lack reliable sea‑food imports. The “Pro tip” for exporters: obtain the EAEU’s Green Fisheries Certificate to qualify for premium shelf space.
Geopolitical Context: Why Timing Matters
The formal signing is slated for the EAEU Summit in St. Petersburg (December 2025). While the exact date is still being coordinated, both sides are scrambling to ratify the draft in national parliaments. The urgency is underscored by recent reports from Qazinform about Kyrgyzstan’s $1.2 billion trade surge with Turkey—demonstrating how quickly regional blocs can pivot when new trade mechanisms open.
Future Trends to Watch
- Digital Trade Platforms – Expect a joint Indonesia‑EAEU e‑commerce portal by 2026, leveraging blockchain for customs clearance.
- Investment Flows – Indonesian firms may set up assembly lines in Kazakhstan to bypass EU anti‑dumping duties.
- Logistics Hubs – The development of a “Silk Road” rail corridor linking Jakarta to Moscow could halve transit times for bulk goods.
FAQ
- When will the Indonesia‑EAEU FTA be officially signed?
- The signing is expected during the EAEU Summit in St. Petersburg, scheduled for December 2025, pending ratification by all member states.
- Which Indonesian products will benefit from zero tariffs?
- Key exports include crude palm oil, textiles, manufactured goods, agricultural produce, and fishery products.
- How will the FTA affect Indonesia’s wheat imports?
- With a safer domestic supply chain and reduced reliance on Russian wheat, Indonesia aims to lower import volumes and strengthen food security.
- Are there any risks for Indonesian exporters?
- Regulatory compliance, especially regarding sanitary‑phytosanitary (SPS) standards, remains crucial. Early certification can mitigate delays.
Take Action
If you’re a trader, investor, or policy analyst, now is the time to explore opportunities within the Indonesia‑EAEU corridor. Get in touch with our trade advisory team or subscribe to our newsletter for real‑time updates and market reports.
