Southeast Asia Studies presents
Mr. Septian Hario Seto, Member of National Economic Council, Republic of Indonesia:
“Value Added Policies for Critical Minerals and Its Geopolitical Challenges: An Indonesia Experience.”
Indonesia’s value-added strategy for critical minerals—centered on export restrictions for nickel ore, domestic processing mandates, fiscal incentives, and a combination of investment and industrial policies—aims to shift the economy from raw-ore extraction to higher-value manufacturing. Using nickel as the focal case, the presentation will show evidence of success: a rapid build-out of industrial capacity for nickel processing; the emergence of industrial parks (e.g., Morowali and Weda Bay) that integrate power, logistics, and services; movement up the value chain from ore to ferronickel/NPI, stainless steel, and battery-grade intermediates (MHP, nickel sulfate); rising foreign direct investment with technology-transfer provisions; and a measurable shift in export composition toward processed products and EV-related inputs.
These gains are unfolding within a sharp geoeconomic rivalry. Chinese firms, which dominate processing capabilities for most critical minerals globally, have played a pivotal role in financing and operating Indonesian projects—accelerating capacity growth, technology, and offtake in the early years. Therefore, this presentation also explains Indonesia’s strategy in responding to the geopolitical tension between China and Western countries, particularly the United States, by prioritizing national interests as the main reference point and maintaining the long-standing principle of an independent and active foreign policy. In addition, the presentation will also discuss the Government of Indonesia’s efforts to address key ESG issues, including those related to tailings, deforestation, and carbon emissions.