The Indonesia–Japan Economic Partnership Agreement is a bilateral agreement signed between

Indonesia Indonesia, officially the Republic of Indonesia, is a country in Southeast Asia and Oceania between the Indian and Pacific oceans. It consists of over 17,000 islands, including Sumatra, Java, Sulawesi, and parts of Borneo and New Guine ...

and

Japan Japan ( ja, 日本, or , and formally , ''Nihonkoku'') is an island country in East Asia. It is situated in the northwest Pacific Ocean, and is bordered on the west by the Sea of Japan, while extending from the Sea of Okhotsk in the north ...

on 20 August 2007 and having been in force since 1 July 2008. Initiated by Japanese Prime Minister Junichiro Koizumi, it was Indonesia's first bilateral free trade agreement. Since 2013, Indonesia has requested a review of the terms of the agreement, and negotiations are currently underway.

Agreements

The agreement contained clauses related to free trade of goods and services between the two countries through the removal of tariffs, while adjusting investment regulations to attract Japanese investors to Indonesia. It also covered specific topics such as intellectual property, customs procedures, and energy/mineral resources. The agreement also allowed some Indonesian nurses to work in Japan.

History

A trade agreement between Japan and Southeast Asian countries (including Indonesia) had been floated as an idea by then Japanese Prime Minister Junichiro Koizumi during his visit to

Jakarta Jakarta (; , bew, Jakarte), officially the Special Capital Region of Jakarta ( id, Daerah Khusus Ibukota Jakarta) is the capital and largest city of Indonesia. Lying on the northwest coast of Java, the world's most populous island, Jakarta ...

in January 2002, when he briefed Indonesian President

Megawati Sukarnoputri Diah Permata Megawati Setiawati Sukarnoputri (; born 23 January 1947) is an Indonesian politician who served as the fifth president of Indonesia from 2001 to 2004. She previously served as the eighth Vice President of Indonesia, vice president f ...

. Further talks were conducted between the two when Megawati visited

Tokyo Tokyo (; ja, 東京, , ), officially the Tokyo Metropolis ( ja, 東京都, label=none, ), is the capital and largest city of Japan. Formerly known as Edo, its metropolitan area () is the most populous in the world, with an estimated 37.468 ...

in June 2003. Following a brief interruption due to the

2004 Indonesian presidential election Presidential elections were held in Indonesia on 5 July 2004, with a second round on 20 September. They were the first direct presidential elections in the country; prior to a 2002 amendment to the Constitution of Indonesia, the President and Vic ...

which saw Megawati's replacement with

Susilo Bambang Yudhoyono Susilo Bambang Yudhoyono (born 9 September 1949), commonly referred to by his initials SBY, is an Indonesian politician and retired army general who served as the sixth president of Indonesia from 2004 to 2014. A member of the Democratic Party ...

, the agreement's progress continued in December 2004 when both countries agreed to form a "study group" to explore a potential

free trade agreement A free-trade agreement (FTA) or treaty is an agreement according to international law to form a free-trade area between the cooperating states. There are two types of trade agreements: bilateral and multilateral. Bilateral trade agreements occur ...

. Findings of the study group were published in May 2005, and it recommended negotiations to be conducted in parallel with the agreement between Japan and the

ASEAN ASEAN ( , ), officially the Association of Southeast Asian Nations, is a political and economic union of 10 member states in Southeast Asia, which promotes intergovernmental cooperation and facilitates economic, political, security, militar ...

. A joint communique following a meeting by Yudhoyono and Koizumi on 2 June 2005 announced the initiation of negotiations. By November 2006, both governments announced that an agreement has been reached "in principle", though the seventh and final round of negotiations would only occur in June 2007. Japan's cabinet approved the terms of the bilateral agreement on 10 August, and the agreement was signed on 20 August 2007 in Jakarta. The treaty came into force on 1 July 2008. It was Indonesia's first bilateral free trade agreement.

Renegotiations

As part of the agreement, a general review is mandated within five years, and the Indonesian government called for one in 2013. Starting in 2015, both countries agreed to renegotiate the terms of the agreement, with the Indonesian side (under President

Joko Widodo Joko Widodo (; born 21 June 1961), popularly known as Jokowi, is an Indonesian politician and businessman who is the 7th and current president of Indonesia. Elected in July 2014, he was the first Indonesian president not to come from an elite ...

) intending for Japanese investors to increase investments in Indonesian infrastructure. Negotiations continued throughout 2018 and 2019, with an initial target of completing negotiations by the end of 2019. As of January 2020, negotiations still continued on a renewed agreement.

References

External links

Full text of the 2008 agreement
{{DEFAULTSORT:Indonesia-Japan Economic Partnership Agreement Free trade agreements of Indonesia Free trade agreements of Japan Treaties concluded in 2007 Indonesia–Japan relations