Indonesia Bans Export Of Nickel Ore Upsets Eu, Appeals To WTO
The EU filed a complaint with the World Trade Organization (WTO) on November 22 regarding Indonesia's restrictions on nickel and other raw material exports. Indonesia aims to leave these raw materials to the domestic smelting and stainless steel industries.
The European Commission, which coordinates the trade policies of the 28 member states of the European Union, said the restrictions unfairly restricted EU producers' access to nickel ore, particularly scrap, coal, coke, iron ore and chromium.
The European Commission's complaint states that these measures are part of a plan to develop Indonesia's stainless steel industry.
Indonesia is the world's largest producer of nickel ore. The country plans to ban nickel ore exports from 2020, two years ahead of 2022.
The European Iron and Steel Association (Eurofer) said that Indonesia has become the second largest stainless steel exporter, and its share of the EU market has increased from a near-zero level in 2017 to 18% in the second quarter of 2019.
The production process of Indonesia's domestic smelting application results in eight times the carbon dioxide emissions of the production process used in Europe.
"The risk is that cheap, highly polluting steel caused by this human factor replaces environmentally friendly steel produced by EU domestic producers and traditional trading partners," Eurofer said.
EU Trade Commissioner Cecilia Malmstrom said Indonesia ’s measures to ban nickel exports have put the EU ’s already struggling steel industry at risk of further layoffs.
"Despite our efforts to push it to adjust this unreasonable policy, Indonesia has maintained these measures and even announced the implementation of a new export ban starting in January 2020," she said in a statement.
The EU has also questioned a plan to waive tariffs on certain imported products by Indonesian manufacturers, which requires Indonesian manufacturers to upgrade or build a new plant, as long as the local machinery and appliances account for 30%. The European Union considers this an illegal subsidy.