Jakarta. An Australian government official on Friday suggested cooperation with Indonesia to improve the environmental and labor standards of the resources sector, including nickel, amid the weakening price of the silvery-white metal.

Indonesia and Australia hold rich reserves of the minerals needed to produce electric vehicles. Both countries have the world’s largest nickel reserves. But like any other sector, considerations of the environmental, social, and governance (ESG) principles are crucial.

“There is an enormous common interest. There is a very strong appetite in Indonesia for both Australia and Indonesia to work together on building the capability around these ESG standards,” Tim Ayres, the Australian assistant minister for trade, told a forum in Jakarta.

“That’s of course because the government of Indonesia is improving ESG standards because of their own values. But that is because that is what customers around the world will be demanding. If we really go add additional economic value, that means being ready and able to max the sustainability requirements,” Ayres said. 

Ayres’s visit came at a time when nickel prices were falling sharply, even triggering mine closures in Australia. Wyloo Metals, a nickel producer owned by tycoon Andrew Forrest, recently announced it would temporarily shut down its Western Australian mines. Followed by the closure of Australian mining firm BHP’s processing operations. News outlet ABC earlier this week reported that nickel prices were down over 40 percent.

Ayres claimed his visit was not particularly aimed at addressing the nickel issue. But just a day ago, Australian resources minister Madeleine King expressed concerns over the need to enable Australian nickel, which she claimed to be highly ESG-compliant, to compete fairly in the global markets.

“There is no differentiated international trading market in nickel or lithium produced to higher ESG and labor standards. If the world is really serious about helping the planet, we need to ensure all materials we mine and manufacture are as green and as clean as they can be,” a recent press statement by King reads. 

“Australian nickel and lithium producers must be able to compete fairly in international markets. … When the playing field is fair, Australian resources stand a fair chance,” the statement reads.

Last year, Australia announced its strategy to strengthen economic ties with Southeast Asian nations. The document includes action plans that Australia wishes to pursue with each ASEAN country. In Indonesia, Australia wants to explore opportunities to help with ESG standards and reporting in the resources sector. 

According to the US Geological Survey, Indonesia’s nickel reserves stand at 21 million tons. The same goes for Australia.