Indonesia-Australia Strategic Cooperation: Advancing Electric Vehicle Batteries

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Indonesian President Joko Widodo and Australian Prime Minister Anthony Albanese met on July 4 to discuss strategic cooperation between their nations, primarily focusing on developing the green economy and regional security.

Recognising Australia’s significant role as a major supplier of lithium, a crucial component in EV batteries, President Widodo sought cooperation from Australia in jointly producing EV batteries.

“Indonesia and Australia must build a more substantive and strategic economic cooperation through the joint production of EV batteries,” President Widodo stated during a press briefing following the leaders’ meeting in Sydney.

President Widodo further revealed Indonesia’s ambitious goal of producing 1 million electric cars and 3.2 million electric motorbikes by 2035. To support this vision, Indonesia’s Chamber of Commerce and Industry (KADIN) signed an “action plan” with the state of Western Australia, focusing on critical mineral supply chain development and the enhancement of worker skills in the sector.

Prime Minister Albanese announced a A$50 million initiative to attract private climate finance to Indonesia. Export Finance Australia pledged $200 million in capital financing to support PT Perusahaan Listrik Negara (PLN), Indonesia’s state-owned electricity company, in its energy transition.

To facilitate closer business ties, Australia will also implement visa changes to simplify business travel for Indonesian visitors. With two-way trade valued at A$23.3 billion last year and Australian investments totalling A$4.3 billion ($2.87 billion) in 2021, Indonesia ranks Australia’s 13th largest trading partner.

Furthermore, the leaders highlighted the ongoing negotiations for a defence treaty, underscoring the importance of diplomatic efforts in the Indo-Pacific region. 

“All countries large and small have a collective responsibility to help keep the region peaceful, and Indonesia’s contribution to regional security under the president’s leadership has been central,” Albanese said.

The collaboration between Indonesia and Australia in the electric vehicle industry holds promise for their economies and the global transition to a greener future.

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