The United States has sounded out Indonesia about joining a multilateral partnership to raise environmental standards in Southeast Asian countries as the two countries discuss critical minerals trade, a senior U.S. administration official said on Monday.
Jose Fernandez, U.S. Under Secretary of State for Economic Growth, Energy and the Environment, spoke to the Indonesian government during a visit to Jakarta this week about the Mineral Security Partnership, a collaboration between 14 countries and the European Union.
Speaking at a press conference in Jakarta, he said the MSP, which aims to accelerate the development of sustainable critical minerals supply chains and encourage financial and diplomatic support, would be an opportunity to improve environmental standards and governance in Indonesia’s minerals sector.
Indonesia, which is rich in minerals such as nickel, copper and bauxite, is keen to position itself as a production hub for batteries and electric vehicles.
The country has significantly expanded its nickel processing industry since banning the export of raw ore in 2020, but environmentalists blame the industry for deforestation, water and air pollution caused by smelters.
“We believe this will lead to more investment in Indonesia, and not just any investment, but investment that benefits the local community and adheres to labour and environmental laws,” Fernandes said.
He added that Indonesia is one of seven countries helping the United States become a semiconductor hub.
Jakarta has urged the United States to conclude a critical minerals trade agreement similar to the one between the United States and Japan.
Fernandez said talks were progressing positively but declined to say when an agreement might be reached.
“We are very pleased with the progress of the discussions and intend to continue to expand them,” he said.
Indonesia’s Economy Ministry did not immediately respond to a Reuters request for comment on the talks.
(Reporting by Francisca Nangoy; Additional reporting by Stefano Sulaiman; Editing by Jan Harvey)
