Prabowo Subianto, an ex-military commander and former son-in-law of Indonesian dictator Suharto, is finally on his way to the presidency. During the campaign season, Prabowo drummed up the promise that he would continue Indonesian President Joko “Jokowi” Widodo’s policies, including the promise of nickel-for-battery developments. Lo and behold, it worked. Unofficial early counts show that Prabowo won by 58%, an easy victory.
During his long and bloody career, Prabowo has crafted a “strongman” image for himself. Although this election saw him rebranded as a “cuddly grandpa”, the strongman image remains an important appeal to his supporter base. Indonesia is an impossible country, the belief goes, and only the strongest leader can make things possible.
Now, challenges to downstream nickel and capturing its value-added within Indonesia’s borders – one of Jokowi’s flagship programs – are mounting. Experts say that on the current trajectory, Indonesia is “unlikely to meet the promise” of nickel-to-battery supply chain development.
Does Prabowo, with his fiery speeches and nationalist campaign, have what it takes to turn things around? A key task to accomplish this is to bring Indonesia’s nickel away from China’s orbit, even for just a little.
This year, the Energy Shift Institute predicts Indonesia to hold less than 0.4% of global battery manufacturing capacity. Even with domestic nickel production rising more than eightfold since 2015, Indonesia is still “falling behind” and unlikely to catch up with battery production, the institute’s report said. The value added of Indonesia’s current nickel products is stuck between 2-11 times, far behind the initial promise of over 60 times had battery production taken off.
Complicating the situation is Indonesia’s low electric vehicle adoption compared to its neighbors, such as Thailand and Vietnam. “The rationale for battery and electric carmakers seeking locations to build production bases typically follows the market,” author Putra Adhiguna wrote in his report. EV sales continue to grow in Indonesia, but they are dominated by nickel-free LFP batteries.
With Washington’s Inflation Reduction Act (IRA) launched in 2022 and the realities of US-China rivalry in the supply chain, Indonesia will have to convince the West that it can become the latter’s valuable partner as well. It’s becoming clear that Indonesia’s nickel success hinges on accessing the Western markets and reducing dependence on China.
To get on the West’s good side, Indonesia must first acknowledge problems in the high environmental and human costs of its domestic nickel production. It must first be able to accept criticisms and then commit to improving governance. To improve governance, Indonesia must gain the trust of all its stakeholders in the industry, reform monitoring agencies and involve civil society groups.
Is Prabowo such a leader?
Analysts have often described Prabowo as “unpredictable”. Among Indonesian journalists, Prabowo is known as temperamental. He has gotten angry several times, often at media workers whom he perceives as constantly “cornering” or “attacking” him. “In Indonesia’s elite circles… his temperament remains a talking point,” wrote Emma Connors of the Australia Financial Review.
Ben Bland, director of the Asia-Pacific program at Chatham House, said that although Prabowo shares some of Jokowi’s desires — such as turning Indonesia into a modern industrial powerhouse and building a new capital city — “Prabowo is unlikely to be as focused as Jokowi on attracting investment and developing infrastructure.”
“Prabowo capitalized on Indonesians’ desire to see a continuation of Jokowi’s policies – and Jokowi’s desire to maintain influence once he steps down,” Bland wrote in his expert comment. “But, when he gets his hands on the levers of power, Prabowo will want to set his own agenda.”
Prabowo’s dark past will forever haunt his leadership. In the 1980s, Prabowo was head of the special forces unit running the occupation of East Timor. Indonesian forces killed over 300,000 people, or about 44% of the population before the invasion. Prabowo was once married to Titiek Suharto, the daughter of Indonesian dictator Suharto who rose to power after killing an estimated of up to one million people — some even say millions. Prabowo was also involved in kidnapping dozens of activists in 1998 in a chain of events that led to the May riots that year, which killed over 1,000 people and attacks against ethnic Chinese community, including mass rapes against Chinese Indonesian women and girls.
During the campaign season, Prabowo and his running mate, Gibran Rakabuming Raka, said the word “nickel downstream” countless times, and it became a running joke on Indonesian social media. But his lack of clear strategy is telling. Prabowo is prone to repeating the same mistakes as his predecessor, possibly with other natural commodities he has envisioned to be processed within Indonesia.
As for nickel, the current trajectory shows that Indonesia’s likely path is to shift from exporting stainless steel materials to intermediate, battery-linked products “while remaining short on battery production development,” the Energy Shift Institute’s report concluded.
Perhaps, this will be good enough for Prabowo, who will surely find a way to frame it as a success.
