Jakarta: Indonesia wants to secure a trade deal with the European Union (EU) in hopes that Jakarta can compete with fellow ASEAN member Vietnam, particularly on footwear exports, according to a senior minister on Wednesday.
Hanoi already has a trade pact with the European bloc — something that Indonesia has been eyeing for years. The EU-Vietnam Free Trade Agreement (EVFTA) seeks to eliminate 99 percent of all tariffs, thus paving the way for more Vietnamese footwear products to enter the European market.
“Vietnam has struck a trade deal with Europe. … So Vietnam enjoys zero import duties for almost all of its manufactured goods,” Chief Economic Affairs Minister Airlangga said at the Investor Daily Roundtable conference in Cirebon on Wednesday evening.
“For instance, in the footwear industry. … We have to face 20-percent import duties when we export to Europe, as well as the US. While our competitor Vietnam gets zero tariffs,” Airlangga said.
Indonesia has been negotiating a comprehensive economic partnership agreement (CEPA) with the EU since 2016. Both sides have concluded the 16th round of talks and will hold the next meeting next month. The government wants to wrap up the CEPA talks this year.
“A trade agreement is important to open up market access,” Airlangga said.
