“The IMIP [Indonesia Morowali Industrial Park] began as a flagship project for the processing of nickel, a mineral that underpins the global transition to electric vehicles. Backed by major Chinese firms including Tsingshan, the park quickly grew into a massive enclave of smelters, coal power plants, worker housing, internal transport systems and supporting facilities. Today, the complex spans thousands of hectares, operates around the clock and absorbs billions of dollars in foreign direct investment (FDI). It has become one of the largest nickel processing hubs in the world.”
“Many Indonesian observers describe it as an autonomous zone for Chinese investors, protected by national elites who value the fiscal and political benefits of the project. The growth of IMIP created an ecosystem in which formal regulations, from labour standards to environmental approvals, are frequently bypassed or unevenly enforced. The state is present, but often not in control.”
“Morowali represents a broader global phenomenon that arises when industrial enclaves grow faster than the regulatory capacities of the state. In such places, formal sovereignty is intact, yet practical authority is shared, fragmented, or captured by private actors. These zones are not fully autonomous, but they operate with enough discretion to reshape local governance. They become para-sovereign spaces, shaped by the logic of capital rather than the logic of citizenship.”
“The current controversy around the alleged illegal airport reveals the limits of this model. It pushes the state to confront a hard question — can a SEZ become so privileged that it effectively acquires sovereign characteristics? The answer matters not only for Morowali or Indonesia, but for other countries experimenting with similar industrial hubs.”
https://www.thinkchina.sg/economy/indonesias-nickel-hub-beyond-state-control