Industry News

U.S. and Indonesia to Expand Trade Relations with Critical Minerals Talks

Nov. 14, 2024
By: Hannah B. Kreinik


The U.S. and Indonesia are fostering a trade partnership that focuses both countries’ efforts on sustainable development, economic growth, and human and labor obligations. One of the main points of trade talks between the two countries in Washington was the development of diverse and reliable critical mineral supply chains. Critical minerals has been a hot topic of international trade policy in recent years (see our past articles on the subject here, here, and here).

The U.S. and Indonesia discussed different issues, including the environment, free trade agreements, labor rights, and national security. Although the negotiations were expansive, Indonesia made clear that its goals included the Inflation Reduction Act’s tax credit opportunity and a critical minerals supply chain agreement. The U.S. resonated with Indonesia’s ideas for an agreement on both critical minerals and the IRA, while leaving further deal details for the Comprehensive Strategic Dialogue between the countries’ trade officials and a potential U.S. Trade and Investment Framework Agreement (TIFA) meeting later this year. The U.S. has previously put IRA tax credits on the table via an agreement with Japan on the issue and talks for the EU to reap similar benefits. The countries also talked about the up-coming Asia-Pacific Economic Cooperation Summit later this month and returning to critical minerals at the Indo-Pacific Economic Framework for Prosperity deliberations.

We have been tracking the U.S. trade policy towards critical minerals and have seen a trend shifting away from Chinese critical mineral supply chains for a more varied production process (see our prior article on the issue here). The U.S. concern over Chinese monopolies in certain industries are creating threats to U.S. national security and harm to the domestic markets. In addition, the U.S. election results and return of the Trump administration also puts U.S. and Chinese trade relations in a state of flux and apprehension, leading to a switch in critical minerals supply chains.

For more information on critical minerals trade developments, please reach out to the Barnes, Richardson & Colburn team.