In an era characterised by the urgent necessity to transition to cleaner, more sustainable energy systems and to achieve climate-neutral, digitalised economies, both Chile and Indonesia occupy strategic positions on the global stage (IEA 2022). In a context where urgent sustainable shifts must be implemented, the global map of energy and material flows is being redrawn (Post and Le Billon 2025). As leading global suppliers of critical minerals—Chile with lithium and copper, and Indonesia with nickel—these countries have become indispensable to the production chains for the manufacture of low-carbon-emission technologies, such as electric vehicles and renewable energy infrastructure (IEA 2022). Yet they also face a deep paradox. Under what Bringel and Svampa (2023) call the Decarbonisation Consensus—a global tacit agreement to substitute fossil fuels with renewable energy sources while preserving the long-term extractive logic of a reformed (green) capitalist system—countries in the periphery risk intensifying the burdens of sacrifice zones while contributing to global decarbonisation.
While framed as sustainable progress, this global shift may be reviving long-standing colonial patterns—now painted green. Thus, for countries like Chile and Indonesia, the energy transition could either reproduce old dependencies or open a window to rewrite them. The question, therefore, is whether they will continue to serve as exporters of raw materials, bearing the socio-environmental costs linked to extractive activity of a transition framed by the Decarbonisation Consensus, or whether they can seize this moment to redefine their roles in the world economy and critically re-examine society’s prevailing social metabolism.
Energy geopolitics encompasses both the geography of supply and demand and the political efforts to secure affordable, reliable, and sustainable energy sources. It highlights interactions between political actors and physical environments. Thus, as the global energy system evolves, so does its geopolitics (Blondeel et al. 2024). Authors, such as Hira (2025), have pointed out that, just as the quest to control petroleum resources influenced the twentieth century and early twenty-first century, critical minerals will also influence the geopolitics of the present and coming decades. Moreover, this current transformation offers critical mineral–producing countries a unique opportunity to build competitive industries. Experience demonstrates that strategic industrial policies, particularly in research and development (R&D), can enhance the growth of competitive sectors.
In 2024, global demand for critical minerals surged. Lithium demand alone rose by nearly 30%, far exceeding the average 10% growth rate of the 2010s. Consumption of nickel, cobalt, graphite, and rare earth elements grew by roughly 6–8%, driven mainly by energy applications such as electric vehicles, batteries, renewables, and power grids. Copper demand also climbed, propelled by China’s large-scale investments in electrical infrastructure (IEA 2025b). While clean-tech developers sit at the core of the world economy, mineral producers remain at the periphery, absorbing the environmental costs of powering someone else’s transition―China is a particular case of a transitioning economy. This dynamic is exacerbating socio-environmental burdens in resource-dependent economies and regions due to mining activities (Poque González 2025a; IEA 2022). It might reinforce global patterns of ecologically unequal exchange under a new (green) colonial frame (Dorninger et al. 2021; Hickel et al. 2022).
Among the new frontiers of extraction, Chile and Indonesia stand out—not only for their mineral wealth, but for the contrasting political strategies they have adopted to govern it. Indonesia produces over 60% of global nickel; Chile dominates copper (24% of world output) and ranks second in lithium (around 30%). Yet their governance models diverge sharply (IEA 2025b; ITA 2023). In Chile, copper mining is dominated by private companies, which control around 72% of production. The State owns the remaining 28% through Codelco. Major private operators come from the United States, Canada, Australia, Europe, and Asia. Lithium extraction is carried out by only two firms: Soquimich (SQM)—partially owned by Tianqi—and Albemarle Chile, a wholly owned subsidiary of Albemarle Corp. Chile is also a leading producer of iodine, rhenium, sodium, and potassium nitrate (ITA 2023). A current point of controversy involves the alliance between Codelco and SQM for lithium extraction in the Atacama Salt Flat, promoted by the Chilean government as a “win-win, cost-effective, public-private accord”. Though nearing final approval, the partnership has faced intense scrutiny due to the absence of an open bidding process, SQM’s historical involvement in political corruption scandals, and concerns regarding potential socio-environmental impacts (Aylwin et al. 2025; Garretón 2025).
Indonesia, by contrast, has adopted a more interventionist approach. The country ranks among the world’s largest producers of both coal and nickel and also produces copper, gold, tin, and bauxite (ITA 2024). Unlike Chile, Indonesia implemented a ban on the export of raw and unprocessed ores through successive regulations introduced since 2009. The objective was to harness mineral resources for domestic development by expanding processing capacity, increasing value addition, and reducing dependence on raw mineral exports (IEA 2024; ITA 2024). The policy path forces companies to conduct processing and manufacturing onshore before exporting. As a result, Indonesia has attracted substantial international investment to expand its downstream industries. Enterprises are establishing facilities to convert nickel into battery-grade materials suitable for electric vehicle applications; however, socio-environmental concerns have also arisen from foreign companies aligned with environmental, social, and governance (ESG) principles (ITA 2024; Guberman et al. 2024; Anindya 2025). At the same time, the country faces legal proceedings initiated by the European Union (EU)—one of the world’s largest nickel importers—arguing that Indonesia’s policies violate the 1994 General Agreement on Tariffs and Trade (IEA 2024; Sugihartono 2024; WTO 2025).
According to the International Energy Agency (IEA) Policies Database, over the last decades, Chile has published two national policy strategies: the National Lithium Strategy (2023) and the National Mining Policy (2022). In the case of Indonesia, there are two pivotal in-force policies and regulatory instruments: the Energy Ministry Decree No. 77k/MB.01/MEM.B/2022 (2022) and the Energy Ministry Decree regarding National Planning on Mineral and Coal 2022-2027 (2022). Furthermore, Indonesia has defined 46 critical minerals as strategic to the national economy and security (IEA 2025a).
Chile’s strategy reflects a cautious institutionalist trajectory: the state seeks greater strategic control and value capture but through regulated, contractual and incremental means that preserve investor certainty and integrate social and environmental assessment. Indonesia’s policy and national plans, by contrast, embody a more interventionist, neodevelopmentalist stance: policy instruments (including export restrictions and binding national planning) are used to force downstreaming and rapidly capture value domestically, albeit with higher implementation risk and social–environmental trade-offs (IEA 2025a). Chile has signed a Memorandum of Understanding (MoU) with the EU (2023) to boost sustainable raw materials value chains and build a competitive mining sector. It targets EUR 300 billion in investments from 2021-2027, covering five areas: integrating raw materials through projects and trade; research and innovation; aligning with ESG and international standards; developing eco-friendly infrastructure; and building skills (IEA 2025a).
In 2024, the Indonesian Ministry of Trade established benchmark prices (HPE) to guide export duty valuations for specific mining products, including copper concentrate, laterite iron concentrate, lead concentrate, and zinc concentrate (IEA 2025a). Although Indonesia rescinded the requirement to utilise government benchmark prices as the minimum price for minerals and coal sales in August 2025, production levies and tax obligations arising from these transactions would continue to be determined by those benchmark prices (Reuters 2025). Regarding critical minerals, Chile has largely sustained a model of cautious institutionalism—prioritising regulatory continuity and private-sector participation. In contrast, Indonesia has adopted a more interventionist nationalist or neodevelopmentalist strategy, using export bans and state direction to promote domestic industrialisation. Despite their contrasting governance strategies, both Chile and Indonesia are experiencing socio-environmental tensions that reveal the contradictions of a global energy transition developed under the frame of a Decarbonisation Consensus.
In Chile, copper mining, processing, and transport-related activities have long-term socio-environmental struggles linked in the north of the country (mainly), which might be reproduced with the lithium case in the Salt Flat ecosystems (Poque González 2022; 2025b). Indonesian nickel mining and processing also pose socio-environmental challenges, especially in its tropical ecosystem. Furthermore, its industry is highly carbon-intensive due to its reliance on coal. Civil society groups have raised concerns, for instance, by recent calls for Tesla Company to halt investments due to potential deforestation, water pollution, and impacts on indigenous livelihoods (Guberman et al. 2024).
These trajectories invite us to reflect on the intensity, timing, and pathways through which the world is pursuing decarbonisation beyond domestic or national policy strategies. They highlight the inseparable relationship between environment, matter, energy, and the societies that mobilise them (Poque González 2024). An intensive extractive economy built to satisfy (constantly growing) the material demands of capitalist societies inevitably shifts the burdens onto specific territories, revealing that the “green” transition, as currently configured, does not transcend extractivism — it reorganises it. Questioning the prevailing social metabolism is therefore fundamental. In this context, it becomes clear that critical minerals are embedded in patterns of unequal ecological exchange and in the emergence of a new geopolitical metabolism.
Chile and Indonesia remind us that the “green” transition is not merely about technology—it is about power, sovereignty, and the enduring question of who benefits from global change. However, climate change is a global threat, and its impacts are perceived differently across societies based on each society’s prior vulnerabilities. This point must be considered when thinking about facing the current global scenario and the potential climate catastrophes, and how peripheral countries manage their own resources. At present, the trade relations between Chile and Indonesia are characterised by the export of copper and agricultural products from Chile to Indonesia, and the import of footwear and automobiles produced in Indonesia into Chile (OEC 2025). South-South cooperation consistently presents itself as an alternative to a departure from an extractivist-dependent developmental trajectory, and as an ancient desire in Latin America. However, the current landscape remains opaque when considering China’s prominent role in the development of low-carbon-emissions technology and its geopolitical tensions with the United States and the EU; alternatively, it may represent a strategic opportunity for the resource-rich countries of the Global South.
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Further Reading on E-International Relations
- Indonesia’s Role in International Relations: A Perspective from the Global South
- Chile and the Overcoming of Neoliberalism: Countering Authoritarianism and the Self-Regulated Market
- Gender Representation in IR Journals: Experience from Indonesia
- Western Dominance in Indonesia’s Discipline of International Relations
- The Geopolitical Influence of India And Indonesia in SAARC and ASEAN
- The Mandala, Agency and Norms in Indonesia-India Global Affairs
