As the worlds largest nickel reserve country, Indonesia is not willing to be an exporter of nickel resources, but hopes to participate more in nickel refining and processing, power battery production and even the production of electric vehicles, so as to enhance its position in the global electric vehicle industry chain and earn more added value.



On Thursday, local time, Indonesian President Joko? Joko Widodo revealed that the country may impose a tax on nickel exports this year. He also expressed the hope that Tesla will not only produce power batteries in Indonesia, but also put the production of electric vehicles in Indonesia.



Vitol hopes to keep the nickel refining process in China



As the country with the largest nickel ore reserves in the world, Indonesias every move on nickel ore export policy affects the fluctuations of the global market.



According to the report issued by the China Geological Survey in 2021, Indonesias nickel ore reserves account for 31.72% of the world, higher than that of Australia (13.96%) and Russia (8.5%).



As the global trend of turning to electric vehicles continues to strengthen, the market demand for battery metals such as nickel, lithium and cobalt surges. Although Indonesia, as a major exporter of nickel, has benefited from the rise in nickel prices, the Indonesian government is not satisfied with only serving as an upstream material supplier, but hopes to further improve its position in the supply chain of electric vehicles.



Earlier, an Indonesian government official said in early 2022 that the country was studying the progressive tax on nickel, pig iron and ferronickel. In an interview on Thursday, Indonesian President Widodo confirmed the news.



Vitol said on Thursday that Indonesia hopes to add more industrial value, increase national income and provide more employment opportunities.



"This is also our demand for bauxite, copper, tin, crude palm oil and other products." He said, "we are not closed, we are actually open."



At the end of last year, Vitol said that refined nickel could create an added value of up to 35 billion US dollars for Indonesia. The Indonesian government has previously disclosed that jokowi hopes to continuously develop the production level of power batteries in Indonesia, and finally hopes to stop the export of all battery raw materials.



However, if the tax measures are implemented, it may suppress Indonesias overseas sales income in the short term, and may also push up the global market price of nickel. Since the end of 2020, the nickel price has increased by about 30%.



Nickel, coal and palm oil are the main export commodities of Indonesia. Earlier this year, Indonesia temporarily banned the export of palm oil in order to control inflation, which shocked the global market and caused the global palm oil price to soar for a time, which also intensified the global inflationary pressure.



Indonesia also hopes to keep the production of electric vehicles in China



Earlier, Tesla and Indonesia had reached a deal worth about US $5 billion to purchase nickel products from Indonesia. Tesla also signed a five-year contract with the Indonesian nickel processing company to purchase key materials for lithium batteries.



However, Vitols ambitions are not limited to refining nickel and producing power batteries.



He said in an interview on Thursday that he hoped Tesla would not only produce batteries in Indonesia, but also produce electric vehicles in Indonesia. What Indonesia wants is a "huge electric vehicle ecosystem", rather than simply using its natural resources to make batteries.



In May this year, an Indonesian official said that he was trying to arrange a meeting between President Widodo and musk to discuss potential investment. According to the Indonesian government, musk once said that he would consider visiting Indonesia around November to find cooperation opportunities.



To become the first developing country in Asia to levy carbon tax



Widodo also confirmed in the interview that Indonesia will levy a carbon emission tax by the end of this year, which is an early step towards carbon neutrality. The Indonesian government first announced its plan to levy a carbon emission tax in 2021. However, due to the rise in food and fuel prices this year, the implementation of this measure was delayed earlier this year



If implemented, Indonesia will become the first developing country in Asia to levy taxes on carbon emissions.



Indonesian officials had previously said that a carbon emission tax of 30000 rupees (about US $2.01) per ton of carbon dioxide equivalent would initially be levied on coal-fired power plants.



Jokowi said on Thursday that Indonesia has an "ambitious goal" to achieve zero emissions by 2060.



"We have the potential for renewable energy, but it is not easy to switch from coal to renewable energy, because the price of coal is still cheaper."