weighted score 5.2 · nine dimensions
Country Risk Profile
Indonesia
Sourcing risk, regulatory exposure and audit intelligence for Indonesia-origin supply chains.
Forced & child labour
5
Nickel mining flagged on ILAB 2024 for forced labour. Palm fruit listed for child labour. Improving in formal export sectors.
Worker rights & FOA
6
Freedom of association challenges flagged in ILAB 2024. Restrictions on collective bargaining in some sectors.
OHS & audit transparency
5
Improving audit maturity in palm oil and garment export sectors. Significant variation by island and sector.
Food & product safety
4
Functional BPOM competent authority. Moderate RASFF alert rate. Improving equivalence with EU standards.
Environmental & regulatory
6
EUDR standard-risk classification (May 2025) — full due diligence required. Major palm oil and rubber exporter. No active IUU card.
Governance & anti-corruption
7
TI CPI 2024: 37/100. Significant corruption risk in customs, licensing, and regulatory enforcement.
Tariff & preferential access
4
Standard EU GSP beneficiary. Reduced rates on most categories. No FTA with EU in force.
Non-tariff barriers
5
Some products under enhanced controls. EUDR standard risk increases due diligence burden. No sanctions.
Supply chain traceability
5
Palm oil traceability improving under RSPO and EUDR pressure. Significant informal economy in agriculture. Island geography complicates multi-tier visibility.
Labour & Social Risk
Labour & Social Risk
- Palm oil sector
- Forced and child labour documented in palm oil plantations. US CBP has issued Withhold Release Orders (WROs) against multiple Indonesian palm oil producers. USDOL lists palm oil on its List of Goods Produced by Child or Forced Labor.
- Migrant worker risk
- Internal and international migrant workers prevalent in palm oil, fishing, and food processing. Recruitment fee debt bondage documented in fishing and seafood sectors.
- Sectors at risk
- Palm oil production and processing, fishing and seafood processing, garments, nickel mining.
- ILO conventions
- Indonesia has ratified ILO C029, C087, C098, and C105. Enforcement is inconsistent, particularly in plantation and fishing sectors remote from urban inspection capacity.
- ILAB status
- Palm oil and tobacco listed on US Department of Labor List of Goods Produced by Child or Forced Labor.
EU Regulatory Exposure
EU Regulatory Exposure
- GSP status
- Indonesia benefits from EU standard GSP. No EU-Indonesia FTA in force; negotiations ongoing under the IEU-CEPA framework.
- EUDR exposure
- Indonesia is the world's largest palm oil producer and a major rubber exporter. Both commodities are EUDR-regulated. Indonesia faces among the highest EUDR compliance burdens of any sourcing country.
- Palm oil duty
- Crude palm oil: EU MFN duty 3.8%. Refined palm oil: up to 9%. Standard GSP reductions apply. Anti-dumping investigations have been initiated on biodiesel.
- IUU fishing
- Indonesia received an EU IUU yellow card in 2014, lifted in 2016 following fisheries governance reforms. Ongoing monitoring applies.
- EU Forced Labour Regulation
- Regulation (EU) 2024/3015 applies from December 2027. Palm oil supply chains are a foreseeable focus for competent authority investigations given documented forced labour findings.
Logistics & Supply Chain
Logistics & Supply Chain
- Primary export corridor
- Strait of Malacca or Lombok Strait → Indian Ocean → Suez Canal → EU ports
- Key transit chokepoints
- Strait of Malacca, Suez Canal
- Main EU destination ports
- Rotterdam, Hamburg, Antwerp
- Typical transit time
- 22–28 days to Northwest Europe
- Scope 3 relevance
- Long-haul maritime freight from Indonesia to Northwest Europe generates approximately 0.8–1.1 kg CO₂e per kg of cargo (sea freight estimate)