Previous instalments
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Indonesia Economic Outlook 2025 (I): Macro-economy
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Indonesia Economic Outlook 2025 (II): Key Industries
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Indonesia Economic Outlook 2025 (III): Infrastructure
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Indonesia Economic Outlook 2025 (IV): National Development Plans
In the earlier chapters we examined Indonesia’s macro fundamentals, priority sectors, infrastructure pipeline and the “Golden Indonesia 2045” vision. We saw how strategies such as “Making Indonesia 4.0” and industrial downstreaming are pushing the economy up the value chain.
Yet an industrial upgrade is only half the story. For any country that aspires to be a global manufacturing hub and trade gateway, the real question is how to move the goods produced in Indonesia into world markets smoothly and at low cost. That is the focus of this instalment—the dense web of global and regional trade agreements Jakarta has woven.
These are not dull treaty lists. For outward-looking investors they are a “golden key” to unlock new markets and sidestep tariff walls.
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Two Cornerstones: Multilateral Rules & ASEAN Centrality
• Global rule-taker: Indonesia has been part of the GATT since 1950 and a founding WTO member in 1995. This anchors its trade in stable, predictable rules.
• ASEAN hub-and-spoke: As ASEAN’s largest economy, Indonesia uses the ASEAN Trade in Goods Agreement (ATIGA) to secure tariff-free movement across the 6.8-person bloc. Through ASEAN it also plugs into:
– ASEAN–China FTA (ACFTA)
– ASEAN–Korea FTA (AKFTA)
– ASEAN’s separate agreements with Japan, Australia, New Zealand and India
– RCEP (Regional Comprehensive Economic Partnership)Result: produce in Indonesia and you can export duty-free not only to ASEAN but also to China, Japan, Korea, Australia and beyond. -
Tailor-made Bilateral Corridors
Jakarta supplements the multilateral mesh with high-standard Comprehensive Economic Partnership Agreements (CEPAs):
• Indonesia–Japan EPA (IJEPA)
• Indonesia–Australia CEPA (IA-CEPA)
• Indonesia–Korea CEPA (IK-CEPA)
• Indonesia–EFTA CEPA (with Switzerland, Norway, Iceland, Liechtenstein)These deals offer sector-specific tariff cuts and streamlined market entry for targeted industries. -
Breakthroughs & Ambitions
3.1 EU Market Locked In
On 13 July 2025, after nine years and 19 rounds, President Prabowo Subianto and European Commission President von der Leyen announced in Brussels the conclusion in principle of the Indonesia–EU CEPA (IEU-CEPA). Around 80 % of Indonesian exports will enter the EU duty-free once the agreement enters into force.3.2 Next Targets: OECD & CPTPP
• OECD accession: aligning governance, regulation and investment rules with the “rich-country club” will boost investor confidence.
• CPTPP entry: would extend Indonesia’s reach to the Americas and embed it in the highest-standard Asia-Pacific supply chains.Taken together, these moves signal Jakarta’s determination to become a stable, efficient and cost-competitive node in global value chains—turning Indonesia’s cost advantages into seamless market access for investors.
For Chinese firms re-engineering supply chains, choosing Indonesia is no longer merely about cheap land and labour; it is about stepping onto a proven strategic springboard now entering the inner circle of the global economy.
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Set Up in Batang National Special Economic Zone (SEZ) – Wanshinda Industrial Park
In today’s reshaped trade landscape, hesitation is the costliest strategy.
Indonesia, ASEAN’s largest economy, is offering a “zero-lag” production package: state-level SEZ + ready-built standard factories.
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Tariff Breakout
Leverage AFTA and RCEP: 90 % of goods move tariff-free within the region. -
Cost Lock-in
• Tax: 15-year CIT holiday (0 % for first 5 years, 50 % for next 10); import-duty exemption on bonded-zone equipment.
• Labour: 38 % of the workforce is under 25; average factory wage ≈ one-third of China’s.
• Power: RMB 0.5 kWh base, 0.75 at peak.
• Social security: medical 1 %+1 %, pension 8.4 %, injury 0.24 %—combined <10 %. -
Plug-and-Play Factory
1 million m² ready-built green factories in Central Java’s Batang SEZ: highway-adjacent, turnkey utilities, one-stop service.
Scarcer than “cost arbitrage” is a proven strategic springboard.
Contact the Wanshinda investment team now for a tailored landing plan—start while others hesitate, that is true dimensional competition.
Batang SEZ Authority – bilingual hotline, 7×24 response
