August 12, 2024
JAKARTA – Indonesia is aiming to push forward the just energy transition agenda in the second Indonesia-Africa Forum (IAF) amid rising protectionism over resources needed to mitigate and adapt to the impacts of the climate crisis.
The forum, slated for Sept. 1 to 3 in Bali, will see discussions between representatives of governments, business entities and international organizations about potential economic cooperation between Indonesia and African countries.
Among the prioritized sectors in the forum is cooperation on critical minerals, which refer to the resources used for essential components in clean energy technologies, from solar panels to electric vehicles (EVs), such as nickel, cobalt and lithium.
Indonesia and countries in Africa have critical minerals that could complement each other to boost the industry of clean energy technologies, particularly on batteries for EVs, says Deputy Foreign Minister Pahala Mansury.
“If Indonesia wants to be part of the [major] global EV battery supply chain in the future, it must cooperate with Africa because not all minerals are available in the country,” Pahala said during a press briefing on Thursday.
Indonesia has the largest share of nickel reserves with 22 percent of the global stock of the metal in the country. The archipelago also has the most nickel production in the world, with around 40 percent of global output in 2023, according to S&P Global Market Intelligence.
Meanwhile, the Democratic Republic of Congo (DRC) produces around 70 percent of the world’s cobalt, followed by Indonesia in second place. Madagascar and Mozambique are among the top-three graphite producers in the world.
The three minerals are often used in the production of EV batteries’ electrodes.
Indonesia has signed several cooperation agreements with African firms on the matter, such as a deal inked last year between Indonesian state-owned mining holding company MIND ID and Tanzanian state-owned firm STAMICO to explore minerals in both countries.
Pahala added that cooperation on critical minerals between Indonesia and African nations was even more crucial to ensure a just energy transition for developing countries, amid increasing protectionist policies from the Global North, including a campaign on the negative impact of nickel mining in Indonesia.
Indonesia’s nickel industry is often criticized for poor environmental standards leading to deforestation and pollution as well as the use of cheap labor in the mineral-rich regions such as Central Sulawesi and North Maluku.
“We must be able to counter the narrative on green protectionism,” he said, “because downstream critical minerals are ultimately a global competition.”
Efforts to reduce greenhouse gas emissions should not come at the expense of a country’s development, the deputy minister continued, claiming that developing countries produce much lower emissions than their developed counterparts.
Indonesia’s desire to improve cooperation with African nations on critical minerals was motivated by the country’s ambition to become a global EV hub, said international relations expert Irfan Ardhani from Gadjah Mada University (UGM).
“Indonesia might want to strengthen solidarity with Africa, which could be beneficial in the future should the country face problems with the minerals necessary for its EV battery industry,” Irfan said.
He added that the solidarity had a potential to become an “important asset” for both parties to ensure their rights of development and access to technology as major exporters of the minerals.
The technology to refine and develop critical minerals is still dominated by developed countries like China, while exports from developing countries often face strict regulations from Western countries, which potentially hinders the EV industry in developing countries.
Aside from critical minerals, Indonesia is also eyeing potential collaboration with African nations on oil and gas, fertilizers and the health sector, with deals expected to amount to US$3.5 billion.
The target is higher than the first event in 2018, when Indonesia signed deals worth $587 million.
The cooperation between Indonesia and African countries dates back to the 1950s, when Bandung in West Java hosted the Asia-Africa Conference. The relationship has grown closer over the decades, with President Joko “Jokowi” Widodo embarking on a series of work trips to several African countries last year to advance South-South cooperation.