Indonesia-Australia Comprehensive Economic Partnership Agreement set to commence on 5 July 2020

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This article was written by Michael Lawson and Emily Travers-Jones.

On 7 May 2020, Trade Minister Simon Birmingham announced that the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) will enter into force from 5 July 2020, after receiving formal notification that Indonesia has completed its ratification process.

The agreement builds on the existing ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) and deepens Australia's economic and security cooperation with Indonesia – one of its strategically important trading partners.

In our view, the agreement presents significant opportunities for Australian exporters of goods and services across a number of sectors, including food and agribusiness, energy and utilities, financial services and transport and infrastructure.  It also has the potential to provide welcome relief to many sectors adversely affected by COVID-19.  By stimulating growth and investment between and within the two nations, the trade deal will enhance Australia's export capabilities and create jobs which will help affected industries get back up and running as COVID-19 restrictions begin to ease.  

Additionally, the IA-CEPA will help facilitate electronic commerce across the two regions – an area of particular interest over the past few months given the practical headaches caused by the COVID-19 shutdowns. In the IA-CEPA, both Australia and Indonesia have endorsed the use of electronic authentications and signatures, and have committed to working towards paperless trading with the acceptance of digital trade administration documents.

For more detail on the key features and opportunities associated with IA-CEPA, please see our previous alert: Indonesia-Australia Comprehensive Economic Partnership Agreement.

If you would like to discuss the IA-CEPA and what it may mean for your business, don't hesitate to reach out to the authors or one of your regular contacts at King & Wood Mallesons.


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