Tom Allard and Fransiska Nangoy, Jakarta – Indonesia expects to see investment in nickel processing, as well as petrochemicals, double to US$35 billion by 2033, led by investors from China seeking to expand their businesses in Southeast Asia's biggest economy.
Chinese steel and battery companies operating in Indonesia met with the country's Coordinating Minister for Maritime and Investment Affairs Luhut Pandjaitan during his recent visit to Yunnan province, the minister's spokesman Jodi Mahardi said.
Among the projects discussed was a plan by China's Contemporary Amperex Technology Co Ltd (CATL) and Ningbo Lygend Mining Co to create an integrated lithium battery production facility, according to Jodi, who said it would be their largest such facility in the world.
The companies, along with others including Tsingshan Holding Group and Delong Holdings, currently have around $16 billion invested in Indonesia and "made a commitment" to the minister to increase their collective investment to around $20.9 billion by 2024 and to around $35 billion by 2033, said Jodi.
"They will collaborate with investors from France, Japan, South Korea, Australia and other countries," Jodi said.
The companies are planning to expand their nickel processing capacity in Indonesia, as well as investing in petrochemicals and stainless steel, he added.
CATL, Ningbo Lygend and a Tsingshan representative declined to comment, while Delong Holdings could not immediately be reached.
Indonesia, a major nickel ore producer, is keen to expand as a nickel processing hub, starting from steel, to extracting battery grade chemicals from the ore, and eventually producing batteries for electric vehicles (EVs) and building EVs.
A group of Indonesian state-owned companies are planning to form a venture to make batteries for EVs, the chief executive of Mining Industry Indonesia said this week, and the new company would partner with Chinese and Korean firms on projects valued at $12 billion.
Indonesia was the largest nickel ore exporter until it stopped exports in January to ensure there were enough raw materials for investors to use in the country.