Visitors inspect Renault's Twizy electric car during last month's Gaikindo Indonesia International Auto Show in Jakarta. (Antara Photo/Zarqoni Maksum)

Jokowi Signs Regulation to Boost Development of Electric Cars


AUGUST 08, 2019

Jakarta. President Joko "Jokowi" Widodo has signed into effect a presidential regulation that will accelerate the development of electric cars in Indonesia. 

The regulation had been under discussion for more than a year as the president's intent to pursue cleaner modes of transportation met with nationalistic resistance and demands for protection of local automakers.

"I signed it on Monday morning," Jokowi told reporters on Thursday. 

He said the regulation showed a commitment to encourage the automotive industry to start designing and preparing to produce electric vehicles in Indonesia as soon as possible.

Nickel, a metal that is a key ingredient in the production of lithium-ion batteries for the latest generation of electric vehicles, is in abundance in Indonesia, giving the country a comparative advantage. Jokowi said the regulation would ensure that Indonesia's electric car industry exploits this advantage. 

"We know 60 percent of electric car components are in the batteries," he said. "We can later overtake others to build an inexpensive and competitive electric car industry. Because we have the ingredients." 

The country has been gearing up to realize its ambition of becoming a major producer of electric vehicles, as a boom in sales of vehicles with internal combustion engines has increased air pollution and placed a burden or the health of its population.

Jokowi did not provide details of the latest regulation, but the government has indicated that it is ready to offer generous investment incentives.

Last month, South Korea's Hyundai Motor Company affirmed a $2.8 billion investment in the development of electric vehicles in West Java, as the company seeks to make Indonesia its key export hub. Hyundai aims to start operations in 2022.

Masayoshi Son, the founder of Japanese technology investment giant Softbank, last week met with Jokowi and pledged at least $2 billion to support online-based mobility solutions and the development of electric vehicles in Indonesia. 

Indonesia does not currently produce electric vehicles on an industrial scale. The Blue Bird Group, the country's largest taxi operator, resorted to importing Tesla and BYD cars from China to establish its first fleet of electric vehicles.