Assessing Indonesia’s Nickel Export Ban and Its Implications Under WTO Dispute Settlement Mechanisms

Abstract

This study explores the regulatory framework governing dispute settlement within the World Trade Organization (WTO) and examines the legal implications for Indonesia following a WTO ruling. The dispute in question involves Indonesia and the European Union (EU) over Indonesia’s policy banning the export of raw nickel. Implemented as a strategic initiative to enhance the added value of natural resources through industrial downstreaming, this policy was perceived by the EU as harmful to its economic interests. Adopting a juridical-normative approach, the authors analyze legal documents and relevant case materials to understand the procedural dimensions of the WTO’s dispute resolution process. The findings reveal that although the WTO’s dispute settlement mechanisms are clearly outlined, the final ruling significantly influences the feasibility of Indonesia’s nickel downstreaming strategy. Furthermore, the WTO’s decision bears not only on Indonesia’s trade policies but also on its diplomatic relations with the European Union. The study highlights the pivotal role played by international institutions in resolving global trade disputes, illustrating how international law—including key instruments such as the General Agreement on Tariffs and Trade (GATT), the Dispute Settlement Understanding (DSU), and the draft Indonesia–EU Comprehensive Economic Partnership Agreement (IEU-CEPA)—serves as a critical foundation in such legal proceedings.