Indonesia aims to become OECD member in 2 to 3 years, senior minister says

Indonesia aims to complete the accession to become the member of Paris-based Organisation for Economic Co-operation and Development (OECD) within two to three years, a senior cabinet minister said late on Wednesday. 

Southeast Asia’s largest economy hopes to attract more investment and trade deals by becoming OECD member. 

The statement came after OECD, which has 38 member countries, decided last week to open discussion for Indonesia’s accession, following its application last July. 

Chief economic minister Airlangga Hartarto said the country is optimistic about being accepted as an OECD member because he said Indonesia had already complied with the organization's standards, including for a fair economy and anti-corruption. 

“Various principles are relatively the same…so basically we already complied with their (OECD) standards," he said in a press conference after holding a dinner event on Wednesday with the ambassadors of 33 OECD member countries. 

"We hope the process of becoming an OECD member can be completed within 2 to 3 years." 

Indonesia is the first Southeast Asian nation applying for the organization's membership, according to OECD. 

The minister said Indonesia will now jointly work with OECD to complete a roadmap document, which sets out the terms, conditions and process for accession, and aimed to present it at the OECD’s ministerial council meeting in May. 

Indonesia’s accession process will go through a rigorous examination, which will cover issues of trade, anti-corruption, and climate change, to ensure the country meets OECD standards. 

The OECD said there is no deadline for completion of the accession process as the outcome is depending on the country’s capacity to adapt with OECD’s standards and best practices. 

Source: Reuters 

Indonesia's first EV battery cell factory to begin production in April

Indonesia's first electric vehicle battery cell factory will begin operations in April, with most of its output exported to South Korea and India. 

PT Hyundai LG Indonesia (HLI) Green Power, Indonesia’s first electric vehicle (EV) battery factory, will start mass production in April, the Investment Ministry/Investment Coordinating Board (BKPM) announced on Wednesday.  

"In April, the HLI Green Power factory will start mass production, with over 90 percent of the output earmarked for export, especially to South Korea and then to India," ministry special staff for regional relations Tina Talisa said on its official Instagram account @bkpm_id.  

Tina added that the second production cycle was also targeted to commence this year. 

She elaborated that the HLI Green Power factory, located in Karawang, West Java, would have a maximum production capacity of 10 gigawatt hours, capable of manufacturing up to 32.6 million battery cell units.  

Each battery cell will have a power capacity of up to 81 ampere hours or 300 watt hours. The materials required for the battery cells include nickel, manganese, cobalt and lithium. 

The establishment of this factory is also aimed at addressing unemployment in Indonesia, as over 90 percent of its workforce will comprise local employees.  

"The majority of the factory's employees, more than 90 percent, will be Indonesians, including junior engineers," Tina said. The construction of the HLI Green Power factory, which is also the first EV battery cell factory in Southeast Asia, started on May 31 last year. 

HLI Green Power is a joint venture of South Korean firms Hyundai Motor Company and LG Energy Solution and Indonesian state-owned EV battery firm Indonesia Battery Corporation (IBC).  

IBC itself is a joint venture of state-owned companies consisting of state electricity firm PLN, diversified miner PT Antam, aluminum producer PT Inalum and energy producer PT Pertamina.  

In addition to constructing the factory, IBC president director Toto Nugroho said in November 2023 that IBC planned to build around 5,000 battery-swapping stations.  

This initiative aims to assist Indonesia in reaching its goal of achieving 13 percent new and renewable energy by 2024. 

Source: The Jakarta Post 

MIND ID Officially Acquires 14% Shares of Vale Indonesia (INCO) 

The mining industry holding, MIND ID officially took over 14% of PT Vale Indonesia Tbk's (INCO) shares with a value of Rp 3,050 per share.   

This agreement is outlined in the signing of the Definitive Transactions Agreement for The Acquisition of PTVI Shares between MIND ID and Vale Canada Ltd. and Sumitomo Metal Mining Co. Ltd. on Monday (26/2) in Jakarta.   

The Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan, revealed that this acquisition marks the end of the long journey of transferring Vale Indonesia's shares.   

According to him, INCO has been known as one of the nickel companies with good management of Environmental, Social, and Governance (ESG) aspects. However, there are still challenges in downstreaming.   

"Even though the ESG has been well managed, I see that the downstreaming program is still far from the others. We want to go down to the point where kitchen utensils can also be made in Indonesia, so this downstreaming really reaches the small things and this will create jobs," Luhut continued.  

On the other hand, Luhut asked that all licensing processes be immediately completed after this signing. 

One of them is related to the extension of the operating license for INCO, which has four KK licenses with production operation stages that will end on December 27-28, 2025. 

"Licenses that have not been issued should be immediately resolved, especially IUPK, if possible within this week," Luhut emphasized.   

After this acquisition, MIND ID will hold 34% of INCO's shares and become the largest shareholder.   

MIND ID's CEO, Hendi Prio Santoso, revealed that the total value of this acquisition is around US$ 300 million.   

"It will be paid off by June next year and some will be through the capital market mechanism," said Hendi.   

Hendi explained, there will be a new share issuance or right issue. Clearly, the total shares that MIND ID will hold will reach 34%. " 

So there will be a new share issuance, where we will also subscribe. But our total is 14% new and the old one is 20% so the total is 34%," Hendi concluded.  

Source: Kontan