Indonesia and Peru leaders forge trade pact in their meeting
Indonesia and Peru Sign Comprehensive Economic Partnership Agreement (CEPA)
Indonesia and Peru have sealed a significant trade agreement named the Comprehensive Economic Partnership Agreement (CEPA) on August 11, 2025. This agreement, finalized after 14 months of negotiations, marks a significant step in the bilateral trade and economic relations between the two countries [2][4][5].
The agreement encompasses broad trade cooperation across many sectors, including mining, energy transition, fisheries, defense, narcotics control, and food security [2][5]. It facilitates duty-free access and reduces trade barriers, particularly for key Indonesian exports to Peru such as vehicles, biodiesel, and agricultural products [1]. The pact includes provisions to streamline logistics and supply chains, reducing transit times for perishable goods by approximately 20%, which is crucial for agricultural exports [1].
Both countries aim to enhance investment cooperation and technological exchange, especially in new energy and strategic industries [2][5]. This partnership is expected to expand market access for both countries, opening Peru’s growing middle-class market to Indonesian goods and vice versa [1][2][4]. It creates opportunities for Indonesian exporters to diversify beyond traditional markets constrained by rising tariffs, notably by mitigating impacts from U.S. protectionism such as the 19% tariff on Indonesian goods imposed by the U.S. in 2025 [1].
Peru expects to benefit especially in its agricultural, manufacturing, and chemical sectors by accessing Indonesian and broader Asian markets [3]. The agreement is projected to boost bilateral trade volumes significantly and deepen economic ties, with Indonesia aiming to position itself as a regional hub for Asian exports into Latin America [1][4].
Total trade before the agreement in 2024 was moderate, with Indonesian exports to Peru at approximately $331.2 million and imports from Peru around $149.6 million, indicating room for growth under CEPA [4]. The meeting between the leaders, Indonesian President Prabowo Subianto and Peruvian President Dina Boluarte, took place at the presidential palace in the Indonesian capital [8][9]. The Peruvian President was greeted by a marching band and national anthems at the ceremony [6].
This strategic trade partnership focuses on tariff elimination, sectoral cooperation in trade, energy, fisheries, and defense, and enhanced logistics. It aims to diversify Indonesia’s export markets while opening Latin American markets for Peru, fostering stronger economic linkages and resilience against global trade uncertainties [1][2][5].
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