EU to File WTO Complaint Against Indonesia
The reason for the litigation may be concerns about a shortage of nickel ore due to the ban on exports.
Indonesia’s ban on nickel ore exports could prompt the European Union to file a complaint with the World Trade Organization amid concerns about a shortage threatening steel producers. According to Bloomberg, Leopoldo Rubinacci, the director of the European Commission’s Department of Commerce mentioned a possible lawsuit. He referred to the threat posed by Indonesia’s position to the EU steel industry, because nickel is necessary for the production of stainless steel.
According to Rubinacci, the issue of tariffs for stainless steel from Indonesia is currently being considered. According to the representative of the EC, the commission also intends to revise the quotas for Indonesian steel products in order to balance supplies hampered by the introduction of US import duties.
« We are also considering the compatibility of Indonesian measures to ban the export of nickel ore with WTO rules, » Rubinacci said on September 24 in a committee of the European Parliament in Brussels.
The Indonesian government said in August that it intends to ban nickel ore exports from January 1. Thus, the term has moved forward by two years: it was previously assumed that this would happen in 2022. The country’s leaders associates such measures with the desire to raise the level of processing of raw materials within the country. Nickel prices on the London Metal Exchange have reacted to the announcement of rapid growth.
The Indonesian ban will exacerbate the problems of the European steel industry, including the decline in demand from automakers, triggered by the United States unleashed tariff war and the threat of Brexit without a deal.