Finnish officials were drafting a document yesterday to be considered by ministers during a meeting of the EU's general affairs council on Monday.
Britain, embarrassed by the latest reports that Hawk jets have again been used in intimidatory flights over East Timor, has committed itself to voting for the embargo unless there is an immediate change in the security situation.
"Robin Cook will be representing Britain and will be backing the embargo," a Foreign Office spokesman said. "The vote has to be unanimous but I cannot see anybody not agreeing to it."
The decision to enforce an embargo marks a big shift in Britain's and Europe's dealings with Indonesia and is the result of a growing sense among Western governments that they must send a strong political message to President B J Habibie. Britain's armstrade with Indonesia is worth more than pounds 100m a year.
The decision follows the lead taken by New Zealand and - much more importantly the United States - to sever military ties with Jakarta, a move taken in light of the failure of the Indonesian military to ensure peace in East Timor.
Diplomats in Brussels promised a "strong political statement" from Monday's meeting, and suggested that the only potential objection to a ban on arms sales would be that it would have no immediate effect on the situation in East Timor. The ban would cover all arms exports, not just new deals.
It is understood that there are nine Hawk jets still to be delivered to Indonesia as part of a contract with British Aerospace dating from 1996.
Oxfam said one of the jets was waiting to be delivered from the factory at Warton, Lancashire, yesterday where it had already been painted in the cream livery of the Indonesian Air Force. It has even been given its official serial number - one of the final steps before being delivered.
"If the Government wants to send a strong political message to Jakarta it is `Stop the delivery'. To do anything else is indefensible," said Justin Forsyth, the charity's policy director.
A spokesman for British Aerospace said: "The export licence for the sale of Hawk aircraft are issued by the UK Government and it is the sole authority to comment."