The White House said in a statement that countries will join forces to diversify the global semiconductor ecosystem to make the global value chain more resilient, secure and resilient. The US hopes to promote industrial exchange between the two countries through corporate representatives of US semiconductor companies.
This semiconductor collaboration builds on the International Technology Security and Innovation (ITSI) Fund created by the CHIPS Act of 2022. The ITSI Fund provides the government with $500 million ($100 million annually over five years beginning in fiscal year 2023) to fund the development and deployment of “secure and reliable telecommunications networks and ensure the security and diversification of the semiconductor supply chain through new programs and initiatives with allies and partners of the United States.”
In addition, the parties also announced a Memorandum of Understanding on Sustainable Energy and Mineral Development. They will develop technical cooperation on creating an enabling environment and regulatory framework to help increase the use of renewable energy, improve the resilience and security of energy systems, and improve technologies for responsible mining and mineral processing practices. This opens the door to a potential major minerals trade agreement, giving Indonesian nickel access to US incentives and subsidies.
The Indonesian Ministry of Foreign Affairs, in a separate statement, said the presidents recognize Indonesia's global leadership in the nickel, cobalt value chains and other critical minerals, and the U.S. commitment to developing a “total American critical minerals supply chain.” Countries will participate in and promote the US-Indonesia Trade and Investment Framework Agreement (TIFA) and work to reduce supply chain "dependencies and vulnerabilities." It is unclear whether formal negotiations have begun on the limited free trade agreement proposed by Indonesia.
Furthermore, US oil giant ExxonMobil and the Indonesian government are also planning a $15 billion investment to boost industrial growth and promote decarbonization in Indonesia and potentially the entire Indo-Pacific region. Indonesia's state oil company Pertamina will jointly evaluate with ExxonMobil the potential for a carbon capture center deep underground in the Java Sea that could store at least three billion tons of carbon dioxide, according to the White House.
Other areas of green energy cooperation include a feasibility study on small modular reactors that would help Indonesia clean up coal from its power grid.
