Indonesia has become a crucial player in the global electric vehicle industry, leveraging its abundant nickel resources to attract significant investment from major manufacturers such as Hyundai, LG, and Foxconn. Since 2020, Indonesia has secured over a dozen deals worth more than USD 15 billion for battery materials and electric vehicle manufacturing. The country is even courting Tesla Inc. to invest in Indonesia.
To encourage downstream processing investment, Indonesia banned unprocessed nickel exports at the beginning of 2020. This policy change led to several significant investment deals, including BASF and Eramet signing an agreement to evaluate the development of a nickel and cobalt hydrometallurgical refining complex that would generate EV battery materials.
Indonesia’s Investment Ministry also signed an agreement with LG Energy Solution for an integrated EV battery investment worth USD 9.8 billion. In 2021, Indonesia formed the Indonesia Battery Corporation (IBC), a joint venture of state-owned enterprises, to develop an EV battery supply chain in collaboration with foreign investors.
The investment trend continued in 2022, with several major deals in Indonesia’s nickel sector, including a mixed hydroxide precipitate (MHP) plant established in Southeast Sulawesi with Ford Motor, and Hyundai’s launch of its first battery-powered electric vehicle plant in Southeast Asia. Moreover, Aneka Tambang of Indonesia and Hong Kong CBL Limited, a subsidiary of China’s CBL, signed a conditional share purchase agreement for Antams’ nickel mine in East Halmahera, North Maluku.