As global competition for critical minerals increases, China and Indonesia are strengthening cooperation to secure supply chains. China has proposed combining Indonesia's mineral downstreaming policy with its manufacturing expertise to help increase the value of Indonesian products and deepen economic ties.

Analysts believe this strategy helps China maintain access to Indonesia's mineral resources despite the country's ban on raw mineral exports. By investing in local processing facilities, Chinese companies can secure stable supplies while meeting Indonesian regulations.

Indonesia, home to the world's largest nickel reserves, is a key supplier for stainless steel and electric vehicle battery production. Over the past decade, Chinese firms have invested more than US$65 billion in Indonesian smelters, industrial parks, and battery-material processing facilities.

As the United States seeks to reduce China's influence in critical supply chains, Indonesia's strategic importance to Beijing continues to grow. However, Jakarta maintains a balanced approach by cooperating with both China and the United States.