(Bloomberg) — China’s aluminum producers are following in the footsteps of their nickel peers by setting up smelters in Indonesia.
After two decades of rapid growth, China’s aluminum sector is bumping up against a domestic capacity ceiling imposed by President Xi Jinping’s government. At the same time, Indonesia wants to do for aluminum something like what it’s done with its nickel: stop exporting raw ore and get foreign investors to build smelters.
Over the past decade, China has successfully tapped into Indonesia’s vast nickel resources, turning the country into a hub for producing the metal that’s critical for electric-vehicle batteries and stainless steel. They’ve built refineries, smelters, and even a nickel museum on Indonesian islands.
One new Chinese-backed aluminum plant is already up and running in the Southeast Asian nation, with backers including Tsingshan Group Holding Co. — the firm that spearheaded China’s rush to spend billions of dollars to develop Indonesia’s nickel story.
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