Vision Group Report: Invigorating the Indonesia-EU Partnership

In the political cooperation area, cooperation has been
expanding for two decades. This has ranged from from
election observation during the late 1990’s, through human
rights and inter-faith dialogues and even to support on
conflict resolution. The government of Indonesia requested
support from the EU to assist in its conflict resolution
strategy in Aceh. The EU provided the Aceh Monitoring
Mission and facilitation of negotiations by President
Ahtisaari.
In the area of diversity, people to people contact is growing
every year. Students, businessmen and tourists are boosting
these people to people flows towards the million per year
level. In education, the EU provides about 1,000 grants to
Indonesian students to study at European universities per
year.
Thanks to the opportunities opened up by the Partnership
and Cooperation Agreement, the EU and Indonesia have
started cooperating in new areas such as on security issues
like counter-terrorism, such as on research and technology,
such as on human rights dialogue.
In the area of development through trade and investment,
the EU and Indonesia mutually benefit from huge-scale
commercial ties between the two economies:
1. The EU is Indonesia’s second largest investor. Over 700
EU companies are operating in Indonesia, providing
more than 500,000 jobs. This number will increase as
Indonesia’s economy continues on its path to rapid
growth.
2. The EU is Indonesia’s second largest export market.
Indonesia’s exports to EU currently stand at EUR 14
billion but are set to expand as Indonesian companies
move up the value-chain.
In the development through financial cooperation area,
the EU and its Member States provide over EUR 700
million annually to Indonesia across sectors vital for future
prosperity such as education, health, trade and climate
change:
1. The EU and its Member States are supporting
Indonesia’s climate change initiatives with US$1.5
billion, including projects encouraging forestry
conservation and sustainable management. EU
specifically supports Indonesia’s REDD+ strategy, MRV
system, and resilience to climate change impacts. The
EU assists Indonesia’s efforts to combat illegal logging
and ensure credible legal verification through trade
policies and co-operation with government agencies,
the private sector and civil society and the EU promotes
environment friendly consumption and production
through projects in various economic sectors such as
the batik industry
2. The EU and its member states have been leaders in
supporting Indonesia after natural disasters. The
EU was the largest donor to the Multi Donor Trust
Fund for Aceh and Nias to support reconstruction
efforts after the 2004 Indian Ocean tsunami. The
EU has also provided significant financial support
for humanitarian and long-term reconstruction
assistance following the earthquake and tsunami in
the Mentawai Islands, the Merapi volcanic eruption
and in the aftermath of the Yogyakarta and Central
Java earthquakes.
3. Since 2010, EU has provided funds directly to the
Indonesian state budget to support Indonesia’s own
policies and priorities within education. EU co-funds with
Australia a $1 billion programme to increase knowledge,
competitiveness and towards equal opportunities in the
education sector. The EU is supporting implementation
of minimum standards to improve the quality of basic
education in Indonesia.
an eMerGInG Global allIance: IndonesIa and eU toGether
MakInG a dIfference
Given that the EU and Indonesia share the same views
and approaches to common global problems, EU and
Indonesia are natural allies in the global domain and
cooperation through bodies such as the UN or G20 is
expanding rapidly.
1. In WTO, EU and Indonesia are working for fairer global
trade and are engaged in negotiations to secure a fairer
result in the WTO’s Doha Development Round.
2. In the G20, EU and Indonesia worked to achieve a
positive agreement on tackling the 2008 global financial
crisis.
3. In climate change areas, EU and Indonesia have pledged
to reduce greenhouse gas emissions: the EU by up to
30% by 2020 and Indonesia by 26% by 2020.
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