On the sidelines of the Supreme Eurasian Economic Council's meeting in Saint Petersburg on December 21, a Free Trade Agreement was signed between the Eurasian Economic Union and its Member States, on the one part, and the Republic of Indonesia, on the other part.

The document was signed by Mher Grigoryan, Vice Prime Minister of the Republic of Armenia; Natalia Petkevich, Deputy Prime Minister of the Republic of Belarus; Serik Zhumangarin, Deputy Prime Minister — Minister of National Economy of the Republic of Kazakhstan; Daniyar Amangeldiev, First Deputy Chairman of the Cabinet of Ministers of the Kyrgyz Republic; Alexey Overchuk, Deputy Chairman of the Government of the Russian Federation; Bakytzhan Sagintayev, Chairman of the Board of the Eurasian Economic Commission, and Budi Santoso, Minister of Trade of the Republic of Indonesia.

The Republic of Indonesia is the fourth most populous country in the world and the largest economy in ASEAN. The signed Free Trade Agreement is expected to take trade relations between the Union countries and Indonesia to a brand new level.

Work on concluding the agreement had been initiated in December 2022. Over the course of three years, the sides managed to formulate a broad-based document.

“As part of the new trade regime being formed, the Indonesian side has opened preferential access for 90% of the product range. The Union's concessions cover 90.5% of the partner's commodity nomenclature," noted Andrey Slepnev, Minister in charge of Trade of the Eurasian Economic Commission.

He specified that preferential export coverage for our countries in value terms would cover more than 94% of current exports. As a result of liberalizing the trade regime, the average rate applied by Indonesia to the EAEU goods will decrease fivefold, from 10.2% to 2%.

In terms of goods, preferential access will be provided for key agricultural goods of the EAEU, such as grain crops (wheat, millet, rye, oats), spices, certain types of flour, bakery products, fish and cattle meat, dairy products, including powdered milk and cheese, mineral waters, and many other items.

In the industrial sector, concessions were granted for the following categories of goods: products of the metallurgical industry, petroleum products (including light and other distillates), coal and anthracite, fertilizers, primary polymers, products of the forest industry complex (plywood, furniture, etc.), construction equipment, and various types of equipment.

The Republic of Indonesia will also be able to increase supplies of a wide range of consumer goods. This includes automotive components, electronic products (household appliances), and certain types of clothing and footwear.

“The effect of the agreement goes far beyond tariff reduction. Its significance is also determined by a set of regulatory provisions designed to remove barriers to trade and make it simpler and more predictable, which is especially relevant given the ongoing changes in international trade," Andrey Slepnev emphasized.

This entails simplifying procedures in the areas of technical standards and sanitary regulations, customs administration, and rules for determining the origin of goods, as well as establishing a legal framework for the application of a full range of industry cooperation tools in areas of economic development that determine the future of the economies of participating countries.

"Understanding the potential for developing our trade and observing the significant growth rates of the Indonesian economy, we believe that within the next 3-5 years after the agreement comes into force, our trade turnover could double," the EEC Minister in charge of Trade expressed his confidence.

The signed agreement will be submitted for ratification procedures in Indonesia and the EAEU countries, which are necessary for its entry into force.