Indonesia should team up with mineral-rich Argentina, Peru, and Chile to power up its electric vehicle (EV) battery manufacturing dream, according to the country’s Chamber of Commerce and Industry (Kadin).
Indonesia dreams of becoming one of the world’s leading EV battery producers. The country boasts abundant minerals that are key to EV battery production. But rather than solely depending on the domestic reserves, Indonesia’s EV manufacturing should look for additional sources of minerals. And Kadin says this potential new mineral supplier lies in Latin America.
“Chile, Peru, and Argentina are among the highly potential countries that we can partner with to bolster Indonesia’s EV supply and production chain. We can import their critical minerals to increase our supply, especially given how [the said countries] own the resources but do not have the factory,” Kadin deputy coordinator Shinta Kamdani told a press briefing on the Indonesia-Latin America and the Caribbean (INA-LAC) business forum in Jakarta on Monday.
“This will help Indonesia position itself as a global EV manufacturer. Indonesia will be able to save its critical mineral reserves, enabling the country to explore its domestic natural resource reserves in a more prudent, environmentally friendly, and longer-lasting manner,” Shinta said.
Aside from being a critical mineral supplier, Latin America can make a great market. Latin America –along with the Caribbean– holds a combined population size of 660 million people, surpassing that of the European Union (EU) which has approximately 448 million inhabitants.
“We can export made-in-Indonesia EVs and components,” Shinta told reporters.
Latin America’s Mineral Reserves
A 2023 US Geological Survey report shows that Latin America is indeed rich in key EV minerals.
Reserves of lithium in Chile stood at 9.3 million metric tons, making it the largest worldwide. Argentina came in third –just behind Australia– with its lithium reserves base amounting to 2.7 million metric tons.
The world’s largest nickel reserves belong to Indonesia and Australia which own 21 million metric tons, respectively. Latin America’s top economy Brazil possesses around 16 million metric tons of reserves of the silvery-white metal.
An average battery-powered EV uses 83 kg of copper. The same US Geological Survey report puts Chile as the world’s largest holder of contained copper reserves, with around 190 million metric tons. That is twofold of the copper reserves in Peru. Indonesia’s copper reserves base reaches 24 million metric tons.
Government data shows Indonesia-Peru trade rose from USD 404.2 million in 2021 to USD 554.2 million the following year. Indonesia’s bilateral trade with Chile amounted to USD 583.8 million in 2022, up from USD 424.6 million the previous year. The overall trade between Indonesia and Argentina jumped from USD 2.3 billion in 2021 to USD 2.7 billion in 2022.
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