Through ICA-CEPA, Textiles To Indonesian Palm Oil Free To Enter Canada

Minister of Trade Budi Santoso. (Photo: Doc. Ministry of Trade)

JAKARTA - Indonesia's leading commodities will receive exemption from import duties to Canada starting in 2026. The commodities in question range from textiles, paper and its derivatives, wood and its derivatives, swallow's nest to palm oil.

This import duty exemption facility is one of the benefits received by Indonesia from the Indonesia-Canada comprehensive economic partnership agreement or Indonesia-Canada Comprehensive Economic Partnership Agreement (ICA-CEPA).

Trade Minister Budi Santoso said with the ICA-CEPA, trade in goods received a 90.5 percent liberalization of Canadian market access with a trade value of US$1.4 billion.

"There are many products, but Indonesian priority products that can access the market from Canada, such as textiles, paper and their derivatives, wood and their derivatives, processed foods, swallow's nest, and palm oil," he said at a press conference at the Mulia Hotel, Jakarta, Monday, December 2.

Therefore, Budi hopes that Canada can become an alternative to the palm oil market from Indonesia. Moreover, currently, palm oil exports to other countries are experiencing obstacles, especially to Europe.

"With CEPA, access to palm oil to Canada will be easier than other countries that we may now have many problems, so we have to have alternatives, how can we export our palm oil to Canada," he explained.

Based on data from the Ministry of Trade (Kemendag), the total value of Indonesia-Canada trade in the last five years for the 2019 to 2023 period increased by 11.24 percent with a trade value in 2023 of 3.4 billion US dollars.

The total value of Indonesia-Canada trade itself in the period January to September 2024 was 2.6 billion US dollars, an increase of 4.07 percent compared to the same period in 2023.

Meanwhile, in terms of commodities, Indonesia's leading export products to Canada include telephone devices, waste (waste and script), natural rubber, and crates or suitcases. There is no palm oil commodity in Indonesia's leading export products to Canada.

Meanwhile, Indonesian imported products from Canada include wheat (wheat and meslin), mineral and chemical fertilizers, soybeans, chemical paper porridge, and wood porridge.

Therefore, Budi also requested that Indonesian business actors take advantage of this economic cooperation, before there were trade barriers to other countries.

"So this is precisely one way how we accelerate our market process, and to avoid new obstacles from other countries. We can enter other gates through other countries, to enter the country next to it," he added.