ASEAN Urged to Foster Cooperation in Critical Mineral Strategy for Energy Transition

ASEAN Urged to Foster Cooperation in Critical Mineral Strategy for Energy Transition

The clean energy transition is driving soaring demand for critical minerals, with their market value projected to surpass US$770 billion by 2040. These resources are essential for manufacturing batteries, solar photovoltaics (PV), and electric vehicles (EVs). However, global supply is concentrated in a few regions, raising significant challenges. According to the International Energy Agency (IEA), only 70% of copper and 50% of lithium needs will be met by 2035.

ASEAN nations hold significant critical mineral reserves, including 46% of the world’s nickel, 22.7% bauxite, and 20% rare earth elements (REE), per 2023 US Geological Survey (USGS) data. ASEAN also leads in global production of nickel (63%) and tin (42%). Despite these resources, the region relies heavily on China for processing, with over 95% of nickel exports from Indonesia and the Philippines going to China in 2022.

Countries like Indonesia and Vietnam are advancing domestic industries, with Indonesia developing a vertically integrated battery industry and Vietnam's Vinfast emerging as a key EV manufacturer. Yet, competition between ASEAN nations, such as Indonesia's nickel export ban and the Philippines' China-free supply chain strategy, risks undermining regional collaboration.

Experts suggest adopting a coordinated framework, such as a Critical Minerals Alliance, to streamline resource sharing and policy harmonization. Such collaboration could position ASEAN as a global leader in the clean-tech sector while securing supply chains and boosting regional economic growth.

Source: The Jakarta Post