Posted on 15 Nov 2023
US President Joe Biden and his Indonesian counterpart President Joko Widodo signed a comprehensive partnership on Monday in areas including green energy, critical minerals and semiconductors, Kallanish reports.
The White House said in a statement, the countries will join forces on diversifying the global semiconductor ecosystem to make the global value chain more resilient, secure, and sustainable. The US hopes to promote industry exchange between the two nations through corporate representatives from US semiconductor companies.
This semiconductor collaboration is based on the International Technology Security and Innovation (ITSI) Fund, created by the CHIPS Act of 2022. The ITSI Fund provides the government with $500 million ($100 million per year over five years, starting in fiscal year 2023) to promote the development and adoption of “secure and trustworthy telecommunications networks and ensure semiconductor supply chain security and diversification through new programmes and initiatives with US allies and partners.”
Additionally, the parties also announced an MOU on sustainable energy and mineral development. They will advance technical cooperation on enabling environments and regulatory frameworks to help increase the uptake of renewable energy resources, enhance grid resiliency and security, and improve technologies for responsible mining and minerals processing practices. This opens the door for a potential critical minerals trade agreement, giving Indonesian nickel access to US incentives and subsidies.
Indonesia’s foreign affairs ministry said in a separate statement the Presidents recognise Indonesia’s global leadership in the nickel, cobalt and other critical minerals value chains, as well as the US’ commitment to developing a “full US critical mineral supply chain.” The countries will engage and progress the US-Indonesia Trade and Investment Framework Agreement (TIFA), and work to reduce supply chain “dependencies and vulnerabilities.” It’s unclear whether formal negotiation on the limited free trade agreement proposed by Indonesia has commenced.
Moreover, US oil giant ExxonMobil and the Indonesian government also plan a $15 billion investment to boost industrial growth and promote decarbonisation in Indonesia, and potentially across the Indo-Pacific. Indonesia’s state oil company Pertamina will conduct a joint assessment with ExxonMobil on the potential for a carbon sequestration hub deep underground in the Java Sea, which could hold at least three billion tonnes of carbon dioxide, according to the White House.
Other green energy collaboration areas include the feasibility study for small modular reactors to help Indonesia clean its power grid away from coal.
Source:Kallanish
