Indonesia Proposes OPEC-Like Group for Nickel at G7 Summit
Jakarta. Nickel-rich Indonesia on Saturday’s G7 Summit in Hiroshima proposed the establishment of an OPEC-like organization for the silvery metal.
The OPEC, which Indonesia was once a member of, is short for the Organization of the Petroleum Exporting Countries. OPEC says it aims to coordinate the petroleum policies of its member states and keep markets stable to secure regular supply for consumers. And Indonesia wants a similar cartel for nickel-producing countries.
“I hope G7 countries can become a partner in this industrial downstream. It is time to establish an OPEC-like group for other products such as nickel and palm oil,” Jokowi said at the G7 Summit, as quoted by the Presidential Secretariat.
Indonesia has been working on developing its downstream industries, meaning that the country would process or purify raw materials —such as nickel— first at home before exporting them for added value.
At the G7 Summit, Jokowi took the opportunity to promote win-win partnerships. Jokowi told the attending leaders that global south countries should not remain an exporter of raw materials as the world is no longer in the colonial era.
“Is it fair for resource-rich countries like Indonesia to be prevented from enjoying the added value of their natural resources? Or be stopped from processing their natural resources domestically?” Jokowi said.
Nickel is critical for the production of electric vehicle batteries.
The US Geological Survey shows that Indonesia and Australia are tied for having the world’s largest nickel reserves. Both countries’ nickel reserves total 21 million metric tons. In 2022, Indonesia produced an estimated 1.6 million metric tons of nickel.
Government data shows although Indonesia has substantial nickel reserves, the country is not a major exporter of its downstream products such as battery precursors or battery packs.
The G7 encompasses Canada, France, Germany, Italy, Japan, the UK, and the US. The European Union (EU) is a "non-enumerated member", with whom Indonesia has an ongoing dispute on nickel.
The EU filed a lawsuit against Indonesia at the World Trade Organization (WTO) for banning the export of unprocessed nickel ores. The EU feared that the ban, which has been in place since Jan. 2020, would take a toll on the European bloc’s stainless steel production. Indonesia, however, lost the lawsuit, and the Southeast Asian country has already appealed the panel ruling.