Discourse between heads of Indonesia and Peru centers on trade agreements and economic bonding
Peruvian President Dina Boluarte met with Indonesian President Prabowo Subianto in Jakarta on Monday, marking a significant step in strengthening economic ties between the two nations. The meeting, which took place during Boluarte's visit aimed at deepening Peru's ties with Indonesia, Southeast Asia's largest economy, was followed by a closed-door bilateral meeting [1].
The highlight of the visit was the formal signing of the Comprehensive Economic Partnership Agreement (CEPA) between Peru and Indonesia, known as IP-CEPA. The agreement, which began negotiations in 2023, was signed on August 11, 2025, coinciding with the 50th anniversary of their diplomatic ties [3][5].
The IP-CEPA is expected to significantly expand bilateral market access, boost trade competitiveness, and promote economic cooperation between the two countries. The agreement aims to boost trade, especially in agricultural products like cocoa, sugar, rice, and Peruvian blueberries, granting them duty-free access to the Indonesian market [1][2].
Indonesia hopes the CEPA deal will strengthen its trade presence in the region. The agreement facilitates easier access for Indonesian exports such as textiles, footwear, motorbikes, and palm oil into Peru, while also addressing tariff barriers to promote mutual trade growth [1][2][3].
The CEPA further includes plans for negotiating future agreements on investment and services and cooperation in sectors such as food, mining, energy, fisheries, and defense [1][2][3]. For Peru, the pact is viewed as a gateway for Indonesian goods and services into Latin American markets, positioning Lima as ASEAN’s preferred entry point into Latin America, strengthening South-South cooperation, sustainable development, and food security [3][4][5].
The trade surplus between Indonesia and Peru in 2023 was driven by major exports from Indonesia, with Indonesia having a trade surplus of $290.4 million, primarily due to exports of vehicles, footwear, and biodiesel [4]. However, it's worth noting that Indonesia's total trade with Peru went down from 2022 to 2023, with the total trade in 2022 being $554.2 million and decreasing to $444.4 million in the following year [2].
The meeting occurred four days after Trump began imposing higher import taxes on dozens of countries, including Indonesia. Imports from Peru are paying a 10 percent baseline rate that Trump set in April, while imports from Indonesia are subject to a 19 percent rate due to Trump's higher import taxes [1].
Indonesia is pursuing membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership to boost export growth, and Peru is already a member of this agreement. The IP-CEPA is anticipated to significantly boost bilateral trade, contributing to Indonesia's goal of doubling its trade volume with Peru from around US$480 million currently to at least US$960 million [1][2].
In conclusion, the Peru-Indonesia CEPA represents a major advancement in bilateral economic relations, trade liberalization, and strategic partnership for both nations. The agreement is expected to bring about increased trade, improved market access, and enhanced economic cooperation between Peru and Indonesia.
- The Peruvian President's visit to Indonesia marked a step in strengthening economic ties, particularly focusing on the World of Trade and Business, with the aim of deepening ties with Southeast Asia's largest economy.
- The signing of the Comprehensive Economic Partnership Agreement (CEPA) between Peru and Indonesia, known as IP-CEPA, is anticipated to expand bilateral market access, boost trade, and promote economic cooperation, focusing on sectors like agriculture, textiles, footwear, and energy.
- For the world of Finance and Investing, the IP-CEPA presents opportunities for Indonesia's goods and services to enter Latin American markets, potentially positioning Lima as the preferred entry point and strengthening South-South cooperation.
- To further boost bilateral trade and contribute to Indonesia's trade volume goals, Indonesia is pursuing membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and the IP-CEPA is expected to significantly contribute to this, offering increased trading possibilities in the new East-West economy.
