A deadly explosion at a Chinese-owned facility in Indonesia has highlighted the hidden costs of Jakarta’s ambitious bet on battery metal processing to accelerate industrial development, a signature policy of outgoing leader Joko Widodo.
The 21 fatalities at Tsingshan Holding Group’s plant at Morowali on the island of Sulawesi, just weeks ahead of a presidential election, have triggered worker protests, anger on social media, and calls for tighter regulation of a sector that has underpinned the president’s plan to shift Indonesia from ore exporter to electric vehicle hub. The disaster has also prompted the government to demand action from China to improve its smelting operations in the country.
The Southeast Asian nation has become a giant of the global battery material industry in the last decade, thanks to billions of dollars of Chinese investment and a surge in processing plants turning low-grade nickel ore into a key ingredient to power EVs. Seen as a stepping stone toward more sophisticated manufacturing, the policy has created jobs and export revenue, but last week’s tragedy is the worst yet in a series of accidents that have struck an industry expanding at breakneck speed.