November 16, 2022
JAKARTA – Business initiatives conducted throughout the year under the Group of 20 framework have culminated in a series of investment agreements presented at the Business 20 (B20) Summit on Monday.
In his closing remarks at the B20 Summit, President Joko “Jokowi” Widodo assured forum participants that Indonesia was on track to carry out its “grand strategy” of downstream industry development and green energy investment.
The B20 Summit this year gathered more than 2,000 attendees from 65 countries, with more than 1,500 firms represented at the forum.
Indonesia, for its part, has been working to refocus the country’s economy toward the production of value-added goods and clean power.
“I have said this many times before: We will be steadfast,” President Jokowi told forum participants.
In his statement, President Jokowi noted to Australian Prime Minister Anthony Albanese, who was also attending the closing session, that both countries possessed huge deposits of natural resources needed for electric vehicle (EV) batteries.
Jokowi explained that Indonesia had large reserves of nickel, while Australia had significant lithium deposits, putting the two countries in a strong position for EV cooperation.
According to data from the United States Geological Survey (USGS), Brazil and Russia rank third and fourth for nickel reserves with 16 million and 7.5 million tonnes, respectively, behind Indonesia and Australia, which each hold 21 million tonnes.
USGS data shows that Chile has the largest reserves of lithium with 9.2 million tonnes, followed by Australia with 5.7 million tonnes and Argentina with 2.2 million tonnes. Indonesia is not among the top holders of lithium reserves.
“Together [with Australia], we could implement downstreaming in Indonesia,” Jokowi continued.
The President also asked global business leaders to invest in Indonesian green energy, claiming there were 434 gigawatts in potential energy from sources including hydro, geothermal, solar and wind power.
Jokowi also pitched the North Kalimantan Green Industrial Park to investors. He said the government had allocated some 30,000 hectares for its development and that the nearby Kayan River could generate up to 13,000 megawatts of renewable electricity.
“This is an opportunity for investors to establish cooperation with Indonesia. Bring investment, bring technology, because to jointly build a green economy in Indonesia requires a lot of money,” Jokowi added.
Australia-based renewables firm Fortescue Future Industries chairman Andrew Forrest said his company “stood ready” to assist the country in turning its green energy potential into hydrogen power by using electrolyzers.
Such endeavors were more plausible today, he said, as the price of using these systems was one fifth of what it was two years ago. Forrest urged the government to “price” the country’s renewable energies.
“[This is] so we can compete successfully with oil and gas, and let’s turn Indonesia into a great green hydrogen exporter,” Forrest told forum participants on Sunday.
Investment Minister Bahlil Lahadalia said the G20 forum had been a game-changer for Indonesia and other developing countries, as developed nations within the G20 had agreed to a range of concessions they had previously held back on.
Developed countries agreed that all countries had the right to pursue downstream industrialization, he said, whereas previously some countries had preferred for emerging economies to remain raw material exporters so that the developed countries could maintain their competitive advantage.
The Bali Compendium introduced by Indonesia in the course of its G20 presidency is based on the premise that no one-size-fits-all solution exists for investment. The compendium, according to the government’s official explanation of the initiative, “presents a range of options for policymakers looking to promote sustainable investment [and] facilitate the sharing of experiences and policy practices”.
“We really struggle on this one, so we ask for assistance from developing countries within the G20, such as Argentina, Brazil, South Africa and India, because all of us possess natural resources,” Bahlil told reporters on Sunday.
He said several developed countries had also agreed to involve micro, small and medium enterprises (MSMEs) and the local population in investment projects, while these countries had previously objected to state intervention and preferred free-market mechanisms.
Agreements on equitable green investment had also been reached, he said, while previously the so-called global south had only received one fifth of the worldwide investment in the development of renewable energy.
However, member states failed to reach a compromise on the issue of unequal carbon pricing, Bahlil said, noting that the price in emerging markets ranged from US$20 to $30 per tonne, compared to around $100 per tonne in developed countries.
“After I took part in and understood the process, I learned that [the G20] is a very influential forum that could affect global policy,” Bahlil concluded.