From Trade to Transformation: How EU Investment Provisions Shape Environmental Governance in Indonesia and Vietnam

Abstract

This paper examines the transformative influence of European Union (EU) investment provisions on environmental governance frameworks in the ASEAN region. As bilateral and multilateral investment agreements increasingly incorporate sustainability chapters, the EU has positioned itself as a normative actor exporting green standards through trade and investment. Drawing on a comparative analysis of EU-ASEAN investment instruments-such as the EU-Vietnam Investment Protection Agreement and ongoing negotiations with Indonesia-this study explores the legal, institutional, and political implications of such provisions. The paper argues that EU conditionalities catalyse regulatory convergence and incentivize ASEAN member states to integrate environmental governance into national development agendas. Through a qualitative comparative analysis of treaty texts, policy statements, and secondary data, the research highlights both the potential and the limitations of trade-induced environmental reforms in the Global South. The findings contribute to ongoing debates on green diplomacy, sustainable trade, and the diffusion of environmental norms across asymmetrical interregional partnerships.