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Rules of origin to determine Indonesia's IEU-CEPA gains?

16 Feb '26
4 min read
Rules of origin to determine Indonesia's IEU-CEPA gains?
Pic: Shutterstock

Insights

  • Indonesia-EU–CEPA promises deep tariff cuts, but many amongst the stakeholders maintained that rules of origin, not tariffs, will eventually decide real EU market benefit for Indonesia's textile and apparel industry.
  • Strict origin rules could exclude those reliant on imported fabrics, forcing supply-chain upgrades and higher local value addition.

However, for Indonesia’s textile and apparel sector, the real test of the agreement may lie less in headline tariff cuts and more in the fine print, particularly the rules of origin, which will govern who can actually benefit once the deal enters into force, expected in ****, felt many amongst the stakeholders.

As tariffs steadily fall away, access to the EU market will become increasingly shaped by regulatory disciplines rather than border taxes. Issues like due diligence requirements, sustainability benchmarks and traceability standards also loom large for the exporters.

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