Hello,
the configuration is ok. Can you check if you have a default route pointing to your Ethernet0/0, such as this:
ip route 0.0.0.0 0.0.0.0 Ethernet0/0
If this is the case, keep in mind that when you define an Ethernet interface as next hop, the router sends an Address Resolution Protocol (ARP) request for your destination address, which the router realizes is not on this interface. The ARP entry for this address is "Incomplete," as seen by the show arp command. An encapsulation failure then occurs as the router is unable to put the packet on the wire with no ARP entry.
In order to have external connectivity, you need the next hop IP address:
ip route 0.0.0.0 0.0.0.0 X.X.X.X
where X.X.X.X is the next hop IP address...
HTH,
GP