Indonesia and Australia Cooperation in Electric Car Battery Industry: A New Global Power?

Jakarta –

Investment Minister / Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia believes that Indonesia and Australia can become major powers in the world’s electric car battery industry. This can happen if both countries can maintain close cooperation.

Bahlil revealed this cooperation offer when he delivered a keynote speech at the agenda of the 2024 Indonesia-Australia Business Summit (IABS) held in Melbourne, Australia. Not just offering cooperation, Bahlil also said that the Indonesian government has a strong commitment to promote a move towards sustainable development.

Bahlil said diplomatic relations between Indonesia and Australia were very good. However, from an investment perspective, the potential for cooperation between the two countries has not been maximized. As the closest country, Australia’s investment in Indonesia in the last 5 years, 2019 – 2024, is only $1.96 billion.

According to Bahlil, Indonesia and Australia can cooperate in developing the electric car battery industry. Both countries have nickel resources, Indonesia also has cobalt and manganese, only lithium is missing and that belongs to Australia.

“I am sure that the relationship between Indonesia and Australia will be strengthened again. In the context of investment, we can honestly say that it is still not good. This is our joint work. If the two countries can cooperate, this will be a new force in the electric car battery industry,” said Bahlil in a written statement, Monday (13/5/20240).

Bahlil emphasized that Indonesia is currently focusing on moving downstream and is no longer exporting its raw materials to be processed abroad. All products must be processed in the country, get added value, then they can be exported.

This program was implemented by the government in stages since the administration of President Joko Widodo (Jokowi). Nickel was the first commodity to be banned from export in 2020 and the results are now being felt. Bahlil explained that in 2017 exports of nickel derivative products were only US$ 3.3 billion, in 2022 they will increase 10-fold to US$ 33.8 billion.

Of course, this is not easy because it faces challenges from other countries that feel unfair. However, Indonesia still wants to be a developed country, so this policy will continue.

“We have started (downstream), as our plane is taken off. No country can order us to withdraw. We will continue as time passes and global dynamics,” said Bahlil.

In addition, Bahlil also emphasized that the reduction made by Indonesia has taken into account environmental aspects and can be an example for other countries. In fact, he even wanted to invite investors to come to the Weda Bay business district in North Maluku to see the eco-friendly business area for himself.

Based on data from the Ministry of Investment / BKPM over the past 5 years, that is from 2019 – 2024, the total performance of Australian investment in Indonesia reached US$ 1.96 billion. In the period of 2023, Australia is ranked 10th as the largest source of foreign investment (PMA) for Indonesia with investment performance reaching US$ 500 million.

Likewise, in the first quarter of 2024, Australia is still ranked 10th with an investment performance of US$ 172.3 million. The three main sectors that contribute the most investment from Australia are mining which reached 65.4% of all investment, hotels and restaurants with 7.6%, and other services with 6.4%.

(hal/hns)