Canada, Indonesia finalize trade agreement

Canada and Indonesia conclude negotiations for the Canada-Indonesia Comprehensive Economic Partnership Agreement (CEPA) during a recent visit by Mary Ng, export promotion, international trade and economic development minister, to Indonesia.

The CEPA negotiations were launched in June 2021. Following 10 rounds of negotiations, Prime Minister Trudeau and Indonesia President Prabowo announced substantive conclusion of negotiations on November 15, 2024. Remaining issues including with respect to market access have now been finalized. With the objective of bringing the CEPA into force as soon as possible, the two governments commit to sign the Agreement in 2025.

“The negotiations have resulted in a comprehensive trade agreement that addresses rules and market access for goods, services, investment, financial services, and temporary movement of natural persons and includes provisions on intellectual property rights, good regulatory practices, e-commerce, competition, government procurement, small and medium-sized enterprises, women’s economic empowerment, environment, and labour,” said a joint statement by both the governments.

This important milestone in Canada’s long-standing relationship with Indonesia will provide further opportunities for Canadian businesses in one of the Indo-Pacific’s largest and most dynamic markets. The Indo-Pacific is Canada’s second-largest regional export market after the United States. In 2023, yearly two-way merchandise trade between Canada and the region was valued at $257 billion.

As part of the Canada-Indonesia CEPA, Ng signed two MoUs between the governments of Canada and Indonesia on critical mineral co-operation
and on the establishment of a bilateral dialogue on sanitary and phytosanitary issues. Multiple MoUs were also signed between Canadian and Indonesian companies including one between JBS Foods Canada, one of Canada’s largest beef companies, and Indoguna Utama, the biggest beef supplier and distributor in Indonesia. This MoU will help JBS to export beef to Indonesia once all market conditions and Indonesia’s import market access requirements are met.

“Over the last three days, I saw representatives of Canadian businesses from a range of sectors make new connections and expand their businesses’ networks in Indonesia. This successful mission, our largest, was part of our efforts to build on Canada’s strong economic ties with Indonesia and help Canadian companies establish productive links in the Indo-Pacific region, something that is good for Canadian jobs and prosperity,” said Ng.

In a joint statement, the Canadian Meat Council (CMC) and the Canadian Pork Council (CPC) welcomed the conclusion of negotiations for CEPA.

“This landmark agreement represents a significant opportunity for Canada’s meat industry to expand its presence in one of the largest and fastest-growing markets in the Indo-Pacific region,” it said. “This agreement will enhance our industry’s competitiveness and open new avenues for growth. Indonesia, with its population of 279 million and GDP of nearly $1.9 trillion, offers significant potential for Canadian meat exporters.”

Both the organizations commended the inclusion of a robust sanitary and phytosanitary (SPS) chapter, which is enforced by the Agreement’s dispute settlement mechanism and the creation of an ongoing SPS dialogue to allow transparency and prevent SPS requirement from becoming non-tariff barriers.