Minister Suharso Explores Potential Cooperation Related to Minerals When Received Visit from US Ambassador to Indonesia
Minister of National Development Planning/Head of Bappenas Suharso Monoarfa discussed the potential for cooperation in free trade agreements related to minerals, when receiving a visit from the US Ambassador to Indonesia, Tuesday (08/10/2024).
This potential cooperation is motivated by the increasingly urgent need for electric vehicles. Under US policy, as much as 40 per cent of minerals used for electric vehicle battery production must be extracted or processed in the US, or with one of its free trade partners.
In addition, there is a policy that half of the battery components must be produced in North America. As noted, the United States has only 0.4 per cent of global nickel reserves and produces only 18,000 metric tonnes per year.
In contrast, Indonesia’s nickel reserves are estimated to be the largest in the world with 22 million tonnes. Therefore, Indonesian nickel products are increasingly becoming important in the supply chain.
Following up on the meeting, the Minister stated that he would discuss the possibility of establishing a bilateral trade agreement between Indonesia and the United States.
The Critical Mineral Specific Free Trade Agreement (CMS-FTA) to enhance the newly established comprehensive strategic partnership (CSP) between the two countries is also expected to be expedited. Furthermore, the Minister said that the CSP will address topics related to development, environment, and security in line with the anticipated CMS-FTA.
Another follow-up that will be done according to him is to increase trade between the two countries by creating an expansion of the Generalised System of Preferences (GSP) facility for Indonesia.
“Indonesia encourages the United States Congress to accelerate the ratification of the GSP, given its significance to the supply chain,” the Minister explained.
The minister hoped that the meeting would pave the way for a closer partnership between Indonesia and the United States.
”We are optimistic that the establishment of a free trade agreement on minerals will not only benefit both countries, but also contribute to environmental sustainability and inclusive economic development,” he concluded.
Source: Bappenas