Raw Material as Indonesia’s Diplomatic Power in International Trade Towards the EU Case Study: Nickel Ban Policy


Raw Materials


Based on the amendment to Law Number 3 of 2020, Indonesian authorities decided to launch a nickel ban policy on several countries, including the EU, at the beginning of 2021. Authorities claimed that the nickel ban policy can stimulate job creation at the domestic level, bring economic value and improve industry complexity in Indonesia. The EU assumes that nickel export restrictions implemented by Indonesia affect the vital industries in the EU, especially the stainless steel and battery industries. The EU took action to bring this case to the WTO Dispute Settlement Body (DSB). This paper analyzes how important raw materials can be utilized to achieve Indonesian national interest using a qualitative method, adding to the discussion of relations between power and interdependence in global trade, how power can apply in the dynamics of the Indonesian nickel ban policy, and bringing achievement in terms of Indonesia's national interest. The power game utilized by Indonesia is also analyzed in facing a major global economic power. Finally, this paper will examine raw materials (nickel matte) as a diplomatic power in the global market and how its policies bring instability to industries in the EU.



Ahamat, B. A. (2022). Indonesia's Mineral Export Prohibition and Legality of Export Duties Under the GATT Rules. Sriwijaya Law Review . http://journal.fh.unsri.ac.id/index.php/sriwijayalawreview/article/view/1661.

ARISE+ Indonesia. (n.d.) EU & Indonesia Cooperation. Retrieved April 19, 2023, from https://www.ariseplus-indonesia.org/en/about/eu-and-indonesia-cooperation.html

Baldwin, D. A. (2016). Power and International Relations: A Conceptual Approach. Princeton University Press

Barbalet, J, M. (1985). Power and Resistance. The British Journal of Sociology, Vol. 36, No. 4, pp. 531-548. http://www.jstor.org/stable/590330.

Bleischwitz, Raimun. & Perincek, Rüya. (2022). Raw Materials and International Relations. Security and Peace, Vol. 35, No. 3. https://www.jstor.org/stable/26428651.

Center for Energy and Mining Law Studies (2021). It may take years for Indonesia to switch from coal to renewable energy.PUSHEP. Retrieved July 16, 2023, from https://pushep.or.id/it-may-take-years-for-indonesia-to-switch-from-coal-to-renewable-energy/

Dahlez, Heidi.,Pheakdey, Heng. (2017). China's Resource Diplomacy in Cambodia and Beyond: On soft power and strongmen. New York: NOVA Science Publisher. https://www.researchgate.net/publication/315664973_CHINA'S_RESOURCE_DIPLOMACY_IN_CAMBODIA_AND_BEYOND_ON_SOFT_POWER_AND_STRONGMEN

Damuri, Yosse Rizal R. A. (2014). Study on The Impact of an EU-Indonesia CEPA. Jakarta: Center for Strategic and International Studies (CSIS). https://www.csis.or.id/uploaded_file/research/study_on_the_impact_of_an_eu-indonesia_cepa.pdf

Diez, Thomas., Bode, Ingvild., & Da Costa, Aleksandra, F. (2011). Key Concepts in International Relations. Sage Publication.

Dowding, Keith (2012). Why should we care about the definition of power?. Journal of Political Power. dx.doi.org/10.1080/2158379X.2012.661917.

European Commission. (n.d.). EU trade relations with Indonesia. Language selection | Trade. Retrieved April 19, 2023, from https://policy.trade.ec.europa.eu/eu-trade-relationships-country-and-region/countries-and-regions/indonesia_en

Fendrick, J. Reed. (2022). Diplomacy as an Instrument of National Power. Strategic Studies Institute, US Army War College, pp. 179-186. http://www.jstor.com/stable/resrep12023.17.

Indonesian Palm Oil Association (GAPKI IPOA). (2021). EU Needs Nickel, But Discriminates Palm Oil. Retrieved July 16, 2023, from https://gapki.id/en/news/19858/eu-needs-nickel-but-discriminates-palm-oil

Gutman, G. O. (1975). Resources Diplomacy. Australian Institute of Policy & Science, Vol. 47, No. 1, 36-50. https://www.jstor.org/stable/20634675

Hariani, A. (2022). Pemerintah Akan Kenakan Pajak Ekspor Nikel. https://www.pajak.com/pajak/pemerintah-akan-kenakan-pajak-ekspor-nikel/

Hirschman, A. (2018). National Power and the Structure of Foreign Trade. University of California Press

Ariseplus Indonesia,. Kerja Sama Uni Eropa dengan Indonesia.


Indonesia - The Japanese Occupation, 1942-45. (n.d.). Country Studies. Retrieved April 25, 2023, from https://countrystudies.us/indonesia/15.htm

Keating, D. (2019). Coke and nickel keeping EU steel industry up at night. EURACTIV.com. Retrieved April 19, 2023, from https://www.euractiv.com/section/energy-environment/news/coke-and-nickel-keeping-eu-steel-industry-up-at-night/

Keohane, R. O., & Nye, J. S. (1977). Power and Interdependence: World Politics in Transition. Little, Brown.

Marta Cristina, N. P. (2022). Manakah Yang Lebih Besar Untung Atau Ruginya Indonesia Menjalin Kerjasama Dengan China. Jurnal Pendidikan Kewarganegaraan Undiksha Vol. 10 No. 3. https://ejournal.undiksha.ac.id/index.php/JJPP/article/view/52034

Msuya, J. (2021). The Sustainable Use of Natural Resources: The Governance Challenge. International Institute for Sustainable Development. Retrieved April 25, 2023, from https://www.iisd.org/articles/deep-dive/sustainable-use-natural-resources-governance-challenge

Ministry of Foreign Affairs Japan. (1972). Diplomatic Bluebook for 1972. Retrieved July 16, 2023, from https://www.mofa.go.jp/policy/other/bluebook/1972/1972-contents.htm#CONTENTS

Nieto, A. (2013). Exploration The strategic importance of nickel: scenarios and perspectives aimed at global supply. https://www.researchgate.net/publication/259970932_The_Strategic_Importance_of_Nickel_Scenarios_and_Perspectives_Aimed_to_Global_Supply.

Nye, J. S. (1990). Soft Power. Foreign Policy, (No. 80), 153-171. https://www.jstor.org/stable/1148580

Putri, Achma S. W. (2022). Settlement of Dispute on The Cessation of Indonesian Nickel Exports to The European Union By The World Trade Organization. Jurnal Ilmu Sosial dan Humaniora. https://jurmafis.untan.ac.id/index.php/Proyeksi/article/view/2895

Pushep.co.id. (2021). Why does Indonesia's nickel export ban upset the EU? https://pushep.or.id/why-does-indonesias-nickel-export-ban-upset-the-eu/

Ragonnaud, G. (2023). Securing Europe's supply of critical raw materials: The material nature of the EU's strategic goals. The European Parliament.

Ridena, S., Nurarifin, N.,Hermawan, W., & Komarulzaman, A. (2021). Testing the Existence of Natural Resource Curse in Indonesia: The Role of Financial Development. Jurnal Ekonomi & Studi Pembangunan, 22(2), 213-227.

Sandria, F. (2022). Perusahaan China Galang Dana Rp 9,2 T Untuk Smelter Nikel RI. Retrieved from CNBC Indonesia: https://www.cnbcindonesia.com/market/20221124151712-17-390937/perusahaan-china-galang-dana-rp-92-t-untuk-smelter-nikel-ri

Segara, V. (2022). The Significance of EU-Indonesia Trade Relations in the Indo-Pacific. EIAS. Retrieved April 22, 2023, from https://eias.org/publications/the-significance-of-eu-indonesia-trade-relations-in-the-indo-pacific/

Septiari, D. (2019). Germany complains RI nickel export ban will ruin 'struggling' steel industry. The Jakarta Post. https://www.thejakartapost.com/news/2019/12/04/germany-complains-ri-nickel-export-ban-will-ruin-struggling-steel-industry.html

Setiawan, I., & Setiawina, N. (2019). Analisis Daya Saing Serta Faktor-Faktor Yang Mempengaruhi Ekspor Bijih Nikel Di Indonesia. E-Jurnal Ekonomi Pembangunan Universitas Udayana, 877–906. https://ojs.unud.ac.id/index.php/eep/article/view/43134

Siahaan, Doan Mauli Tua I. S. (2021). Restriction Of Indonesian Nickel Ore Export Based On The Perspective Of Quantitative Restriction Principle In General Agreement On Tariffs And Trade. Jurnal Penelitian Hukum De Jure.

Statista. (2022). Natural Resources in Indonesia- Statistics&facts.http://www.statista.com/topics/4690/natural-resources-in-indonesia/#topicHeader__wrapper

Suryano, E. (2022). Apakah Nikel Indonesia Memiliki Keunggulan Daya Saing di Pasar Internasional?. http://ecoplan.ulm.ac.id/index.php/iesp/article/view/506/77

Technology, Mining. (2021). Indonesia launches $2.7 bn China Invested FerronickelSmelter.https://www.mining-technology.com/news/indonesia-china-ferronickel-smelter/#:~:text=Indonesia%20has%20launched%20a%20new,Utara%20county%2C%20Central%20Sulawesi%20province.

Thomson, W. Kenneth. (1981). Power, Force and Diplomacy. The Review of Politics, Vol. 43, No. 3 (Jul., 1981), pp. 410-435. https://www.jstor.org/stable/1406942.

Vanessa, Agata A. T. (2018). Indonesian Minerals Yearbook 2018. Jakarta: Center for Mineral Coal and Geothermal Resources Geological Agency Ministry of Energy and Mineral Resources. https://geologi.esdm.go.id/assets/media/content/content-indonesian-minerals-yearbook-2018.pdf

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.