Sustainable trade? Testing the EU-Indonesia Free Trade Agreement

10 July 2018

From 9 to 13 July, the 5th round of negotiations between Indonesia and the EU for a free trade agreement are taking place. The fact that there was no public announcement of the round highlights the lack of transparency surrounding the negotiations.
To see if this trade deal would support a fair economy, Friends of the Earth Europe did a sustainability check of the draft texts the EU has published. The agreement scores only 4.5 out of 20 points - a clear fail.

The main findings are:

  • The agreement is likely to increase the trade in harmful products like palm oil, which is a main driver of human rights violations and deforestation in Indonesia.
  • It would also lock in a system of corporate courts, a version of the highly controversial ISDS, allowing foreign investors to sue governments for unlimited amounts of compensation. Indonesia has just started to free itself by terminating old treaties with ISDS, including with European countries.
  • It would prioritise increasing trade flows over binding rules on human rights and the environment.