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Govt plans to ‘counterattack’ US, EU mineral policies
Investment Minister Bahlil Lahadalia told reporters on Friday that Indonesia planned to require 60 to 70 percent of mineral output to be processed in-country before being exported.
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A worker processes nickel ore at a smelter in Sorowako, South Sulawesi, on Aug. 1, 2019. (Shutterstock/Kaisarmuda)
T
he government has said it will seek to counter policies from the United States and European Union meant to encourage the domestic processing of minerals crucial for the electric vehicle (EV) industry, which Jakarta says could threaten the development of its own downstream metals industry.
Investment Minister Bahlil Lahadalia told reporters on Friday that Indonesia planned to require 60 to 70 percent of mineral output to be processed in-country before being exported. Increased export taxes would be applied to shipments below that threshold.
In the EV supply chain, the government aims to export nickel only if it has been processed into cathode, an intermediate product a few steps from becoming part of a battery, Bahlil said, adding that the final manufacturing steps could be done at the export destination.
“Under such a situation, Indonesia will make a counterattack,” Bahlil said of the US and EU’s mineral policies.
“We can’t be tricked. It must be fair,” he added.
Read also: China may be hindrance in RI getting FTA with US on critical minerals
Bahlil’s statements were in response to the Inflation Reduction Act (IRA) passed by the US and the Critical Raw Materials Act (CRM) proposed by the EU, which both aim to move the processing of critical minerals and the manufacture of EVs within their borders.
