In a discreet yet significant move, the European Union recently negotiated a deal with Indonesia, securing limited quotas for the import of European wines and spirits. Though the agreement has been kept under wraps to respect Indonesia’s cultural and religious views on alcohol, it marks a notable advancement for European exporters.
A senior EU official, who chose to remain anonymous, acknowledged the sensitive nature of the deal, emphasizing the need to keep it out of the limelight to avoid causing discomfort to Indonesian counterparts. This behind-the-scenes negotiation illustrates the delicate balance the EU is trying to maintain — achieving commercial gains for its exporters while being mindful of local sensibilities.
The agreement involves the use of tariff rate quotas (TRQs), allowing Indonesia to import 1,985 tonnes of wine and 400 tonnes of spirits from Europe at a reduced duty rate of 5 percent. Should these quotas be exceeded, the tariffs will spike dramatically to 90 percent for wine and 150 percent for spirits. Although these quotas may appear modest, they represent a pivotal entry point into the Indonesian market, long resistant to alcohol imports.
For European producers, this represents a symbolic opportunity to gain a foothold in a lucrative yet challenging market. This move could pave the way for further trade engagements between the EU and Indonesia, signaling a potential shift in the country’s approach to alcohol imports. The quiet nature of the agreement highlights the cooperation between the two parties to accommodate economic interests while respecting cultural traditions.