Indonesia–Japan Economic Partnership Agreement

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

Indonesia–Japan Economic Partnership Agreement
TypeTrade agreement
Effective2008 (2008)
Parties

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.[1][2]

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 in January 2002, when he briefed Indonesian President Megawati Sukarnoputri.[3] Further talks were conducted between the two when Megawati visited Tokyo in June 2003.[4] Following a brief interruption due to the 2004 Indonesian presidential election which saw Megawati's replacement with Susilo Bambang Yudhoyono, the agreement's progress continued in December 2004 when both countries agreed to form a "study group" to explore a potential free trade agreement.[5] 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.[6]

A joint communique following a meeting by Yudhoyono and Koizumi on 2 June 2005 announced the initiation of negotiations.[1] By November 2006, both governments announced that an agreement has been reached "in principle",[2] though the seventh and final round of negotiations would only occur in June 2007.[7] Japan's cabinet approved the terms of the bilateral agreement on 10 August, and the agreement was signed on 20 August 2007 in Jakarta.[8] The treaty came into force on 1 July 2008.[1] It was Indonesia's first bilateral free trade agreement.[1][9]

Renegotiations

As part of the agreement, a general review is mandated within five years, and the Indonesian government called for one in 2013.[1] Starting in 2015, both countries agreed to renegotiate the terms of the agreement, with the Indonesian side (under President Joko Widodo) intending for Japanese investors to increase investments in Indonesian infrastructure.[10] Negotiations continued throughout 2018 and 2019, with an initial target of completing negotiations by the end of 2019.[11][12] As of January 2020, negotiations still continued on a renewed agreement.[13]

References
  1. "Factsheet Indonesia-Japan Economic Partnership Agreement (IJEPA)" (PDF) (in Indonesian). Ministry of Trade (Indonesia). Retrieved 15 June 2020.
  2. "Joint Press Statement: Indonesia-Japan Economic Partnership Agreement". Ministry of Foreign Affairs (Japan). 28 November 2006. Retrieved 15 June 2020.
  3. "Koizumi's trade plan hailed by Megawati". Japan Times. 13 January 2002. Retrieved 15 June 2020.
  4. "Siang Ini, Megawati-Koizumi Membahas Ekonomi Bilateral". liputan6.com (in Indonesian). 24 June 2003. Retrieved 15 June 2020.
  5. Sato, Yoichiro; Limaye, Satu P. (2006). Japan in a Dynamic Asia: Coping with the New Security Challenges. Lexington Books. p. 62. ISBN 978-0-7391-1021-8.
  6. "Japan-Indonesia Economic Partnership Agreement Joint Study Group Report" (PDF). Ministry of Foreign Affairs (Japan). Retrieved 15 June 2020.
  7. "The Seventh Round of Negotiations for the Japan-Indonesia Economic Partnership Agreement". Ministry of Foreign Affairs (Japan). 22 June 2007. Retrieved 15 June 2020.
  8. "Signing of the Agreement between Japan and the Republic of Indonesia for an Economic Partnership". Ministry of Foreign Affairs (Japan). 10 August 2007. Retrieved 15 June 2020.
  9. "Indonesia-Japan Economic Partnership Agreement (IJEPA) Reviewed". Indonesia Investments. 22 June 2015. Retrieved 15 June 2020.
  10. "Japan, Indonesia Review Economic Partnership Agreement". Tempo. 25 March 2015. Retrieved 15 June 2020.
  11. "Japanese foreign minister to visit Indonesia next week". Antara News. 23 June 2018. Retrieved 15 June 2020.
  12. "New Indonesian-Japanese deal to be signed in late 2019". The Jakarta Post. 3 July 2019. Retrieved 15 June 2020.
  13. "Pertemuan Indonesia dan Jepang,Bahas Penyelesaian Protokol Amandemen GR-IJEPA". Kontan (in Indonesian). 27 January 2020. Retrieved 15 June 2020.
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