State-run mining firms court American investments – Companies

ining state-owned enterprises (SOEs) are looking at partnerships with United States firms, which they hope could help Indonesia navigate US tariff policies, while seeking the investments needed to build downstream projects in the archipelago.

State mining holding company MIND ID said it would offer an electric vehicle (EV) battery project, dubbed the Indonesia Grand Package, to US investors after South Korea’s LG Energy Solution, one of the early backers of the project, decided to exit the venture.

The move aligns with recent efforts to balance trade relations with Washington, MIND ID’s portfolio and business development director Dilo Seno Widagdo said on April 17.

Mutya Yustika, an energy economist at the Institute for Energy Economics and Financial Analysis (IEEFA), said Indonesia must address several challenges in improving the investment climate to secure foreign direct investment (FDI).

“Although Indonesia has great potential in mining downstream projects, attracting investors in general remains a challenge because the project has a fairly high investment risk,” she told The Jakarta Post on Friday.

Mutya stressed the importance of addressing complicated bureaucracy and regulatory uncertainty to improve the country’s attractiveness as an investment destination.

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“Strengthening the environment, social and governance [ESG] regulations is also critical to attract investors and sustain downstream projects in the country.”