How to view the progress and impact of the government's efforts to complete negotiations aimed at strengthening Indonesia's role in the region and economic cooperation is recorded in the World Business Survey conducted by the SUAR Team.
Some of his findings:
- According to respondents, multilateral and bilateral cooperation agreements entered into by the government are beneficial to the country's economy in many ways. Among other things, they will increase investment realization (75%), improve export performance (75%), and create jobs (65.6%).
- President Prabowo Subianto's communication and leadership style in discussing economic cooperation agreements with other countries has fostered appreciation and confidence among respondents that this will increase investment flows into Indonesia and make Indonesia more advanced (65.6%).
- Indonesia is open to establishing economic cooperation with any country. This was stated by four out of ten respondents. However, two countries are prioritized as more profitable trading or investment partners, namely China (28.1%) and the United States (6.3%).
The year 2025 will be a busy year for the Indonesian government at the negotiating table as it seeks to finalize a number of economic cooperation agreements that have been in the works for several years.
These achievements began early in the year, starting with Indonesia's official accession to the BRICS cooperation among developing countries (January). This was followed by negotiations on the Comprehensive Economic Partnership Agreement (CEPA) between Indonesia and Canada and between Indonesia and the European Union (September). At the end of the year, the Indonesia-Eurasian Economic Union Free Trade Agreement or I-EAEU FTA was also signed (December).
Negotiations on reciprocal tariffs with the United States are still ongoing, and the agreement is expected to be signed by the end of January 2026. Indonesia has secured import tariff exemptions for a number of leading commodities, such as palm oil, coffee, cocoa, tea, and so on. This agreement is a continuation of the US's decision in July to reduce tariffs on Indonesian products from 32% to 19%.
Most respondents stated that the agreement successfully reached by the government would have an impact on increasing investment realization and export performance, as well as creating domestic employment opportunities. This is inseparable from the president's readiness to utilize multilateral forums to carry out economic diplomacy.
Going forward, Indonesia remains open to establishing economic cooperation with any country. However, it is necessary to select which countries to prioritize as trading or investment partners based on various considerations.
To date, China and the United States remain Indonesia's top priorities in economic cooperation. Expanding economic cooperation is necessary to diversify export markets and attract investment, two factors that will drive higher economic growth.
