During Groundbreaking Of Electric Battery Factory In Karawang, Jokowi: Indonesia Must Get Out Of The Trap Of Raw Material Exporting Countries

President of the Republic of Indonesia, Joko Widodo. (Photo: Doc. Setpres)

JAKARTA - President Joko Widodo (Jokowi) wants Indonesia to get out of the trap of raw material exporting countries as soon as possible.

"The state's big business strategy is to get out as soon as possible from the trap of exporting raw materials, to let go of dependence on imported products by accelerating the revitalization of the processing industry," said President Jokowi in Karawang New Industrial City, West Java, Wednesday, September 15.

President Jokowi conveyed this during the groundbreaking of the electric vehicle battery industry factory PT HKML Battery Indonesia which was also attended by Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan, Minister of Investment Bahlil Lahaladia, Minister of BUMN Erick Thohir, Governor of West Java Ridwan Kamil, Regent of Karawang Cellica. Nurrachadiana, Korean Ambassador to Indonesia Park Tae-sung, President of Hyundai Motor Asia Pacific Headquarters, and CEO of PT HKML Battery Indonesia.

The event was also witnessed via a video conference link by Hyundai Motor Group (HMG) Chairman Euisun Chung and LG Energy Solution CEO Jonghyun Kim.

"So that it can provide an increase in higher economic added value," said President Jokowi.

According to President Jokowi, the construction of the factory is a manifestation of the government's seriousness in downstreaming the industry.

"The glorious era of raw material commodities is over and we must dare to change the economic structure that has been commodity-based to enter industrialization into a strong industrial country based on the development of technological innovation," said President Jokowi.

President Jokowi said that downstream nickel industry would significantly increase the added value of nickel ore.

"If it is processed with battery cells, the value can increase up to 6-7 times, and if it is processed into an electric car, the added value will increase 11 times," said President Jokowi.

This means that the development of the battery industry will also increase the attractiveness of Indonesia as an investment destination for derivative industries that use batteries, such as investment in electric motors, electric buses, and electric cars.

"The Indonesian government is fully committed to providing support and providing the development of the battery and electric vehicle industry ecosystem," said President Jokowi.

The government, according to President Jokowi, will also continue to roll out structural reforms to provide legal certainty and ease of licensing for business actors and investors to develop their businesses in Indonesia.

"The government is also open to various cooperation initiatives with friendly countries. I hope that this collaboration between Indonesian and South Korean companies can be strengthened, including the realization of investment cooperation in the realization of the battery and electric vehicle industry," said President Jokowi.

The construction of the electric battery factory is to support the supply of battery-based electric vehicle (BEV) batteries.

The electric car battery cell factory in Karawang, owned by the South Korean company, will be built on an area of 330,000 square meters. When fully operational, the facility is expected to produce a total of 10 GWh of NCMA lithium-ion battery cells annually, enough for more than 150,000 BEV.

Based on the memorandum of understanding, Hyundai Motor Group and LG Energy Solution will invest a total of 1.1 billion dollars or around Rp. 15.9 trillion. Hyundai Group and LG Energy Solution will each have a 50 percent stake.