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Halmahera Should Be a No-Mining, No-Smelter Zone

Muhammad Zulfikar Rakhmat, Yeta Purnama
June 22, 2026 | 2:32 pm
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FILE - A boat cruises past a nickel processing plant at Indonesia Weda Bay Industrial Park in Central Halmahera, North Maluku province, Indonesia, June 8, 2024. (AP Photo/Achmad Ibrahim, File)
FILE - A boat cruises past a nickel processing plant at Indonesia Weda Bay Industrial Park in Central Halmahera, North Maluku province, Indonesia, June 8, 2024. (AP Photo/Achmad Ibrahim, File)

Jakarta. Indonesia and China have built one of the most consequential economic partnerships of the 21st century. Together, they have transformed Indonesia into the world's largest nickel-processing hub, powering electric vehicles, stainless steel production and the global energy transition. The partnership has generated billions of dollars in investment and created tens of thousands of jobs.

But even successful partnerships require limits. Halmahera Island, in North Maluku, should be one of them.

The question is not whether Indonesia should develop its mineral resources. Nor is it whether China should continue investing in Indonesia. The question is whether every place must be sacrificed in the pursuit of industrial growth. On Halmahera, the answer should be no.

Over the past decade, Chinese and Indonesian companies have helped turn Halmahera into a centerpiece of the global nickel industry. The Weda Bay mining and industrial complex has become one of the world's largest nickel operations, supported by Chinese capital, technology and downstream processing facilities. The island is now deeply integrated into global supply chains for electric vehicles and stainless steel.

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Yet Halmahera is not merely a mineral deposit. It is an island ecosystem.

Island geography matters. Unlike continental mining regions, islands possess finite land, fragile watersheds and limited ecological resilience. Environmental damage cannot simply spread into an endless hinterland; it accumulates within a confined space. Forest loss affects entire watersheds. Sedimentation affects surrounding seas. Industrial expansion competes directly with biodiversity, fisheries and traditional livelihoods.

Halmahera's ecological significance extends beyond its forests and coastlines. The island is home to the Hongana Manyawa, one of the world's last Indigenous peoples living in voluntary isolation. Human rights organizations have warned that expanding nickel extraction threatens their territory and way of life. Whether one agrees with every claim made by activists is beside the point. The existence of an Indigenous community whose future depends on intact forests should compel caution, not acceleration.

The argument for restraint is not anti-development. It is pro-strategy.

Indonesia's nickel policy has been remarkably successful in attracting investment. Chinese firms have played a central role in building smelters, refineries and industrial parks that few Western investors were willing or able to construct at comparable speed and scale. Even industry executives acknowledge that Chinese technology and expertise have become indispensable to Indonesia's nickel-processing ambitions.

But success can create its own risks. When every resource-rich area becomes an industrial zone, governments lose the ability to distinguish between places suitable for development and places that deserve protection.

A mature industrial policy is not one that permits mining everywhere. It is one that identifies areas where mining should never occur.

Halmahera should be such a place.

A no-mining, no-smelter designation would not undermine Indonesia's nickel industry. The country possesses extensive nickel reserves across multiple regions. Industrial activity already exists in Sulawesi and other mining centers. The economic future of Indonesia's downstream sector does not depend on extracting every ton of nickel from every island.

Nor would such a policy harm China-Indonesia relations. In fact, it could strengthen them.

Chinese investment increasingly faces scrutiny around the world, particularly in environmentally sensitive sectors. Demonstrating that China-backed projects respect ecological limits would help counter perceptions that economic development comes at any environmental cost. A jointly supported conservation framework for Halmahera could become a model of responsible investment rather than a symbol of unchecked extraction.

The choice facing Jakarta and Beijing is therefore larger than nickel.

The world is entering an era in which the energy transition will demand enormous quantities of minerals. Governments and companies often present this challenge as a simple equation: more demand requires more mines. But sustainability cannot be measured solely by the emissions avoided through electric vehicles. It must also account for the landscapes transformed to produce them.

Not every island should become an industrial park.

Not every forest should become a mine.

And not every economic opportunity should be pursued simply because it exists.

Indonesia and China have already demonstrated that they can build mines, smelters and industrial corridors at unprecedented speed. The greater test of leadership is whether they can decide where not to build.

Halmahera offers that opportunity.

A no-mining, no-smelter, no-go policy would send a powerful message: that economic cooperation between China and Indonesia is strong enough to recognize limits, confident enough to protect irreplaceable ecosystems, and wise enough to understand that some places are worth more preserved than extracted.

On a small island like Halmahera, that principle is not an obstacle to development. It is the foundation of responsible development itself.

---
The opinion article was written by Muhammad Zulfikar Rakhmat, Director of the China-Indonesia Desk, and Yeta Purnama, a researcher at the Center of Economic and Law Studies (CELIOS).

The views expressed in this article are those of the authors.

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