KEM land dispute won't affect foreign investment: Rozy<\/p>\n
By Reiner S<\/p>\n
SANUR, Bali (JP): Newly appointed Minister of Investment and
\nState Enterprises Development Rozy Munir played down on Thursday
\nthe impact of the high profile land dispute between giant gold
\nmining firm PT Kelian Equatorial Mining (KEM) and local people in
\nEast Kalimantan.<\/p>\n
\"I don't think so. Don't worry,\" he told reporters in response
\nto questions that the KEM case would create fear among foreign
\ninvestors.<\/p>\n
The minister said that the inflow of foreign investment into
\nthe country showed an upward trend in the first three months
\ndespite reports of conflicts between some mining companies and
\nlocal communities and local governments.<\/p>\n
The value and the number of projects approved during the three
\nmonths were not huge but the important thing is that there's an
\nincreasing trend, he added.<\/p>\n
Rozy said that his office would continue to improve
\ncommunication efforts with the foreign investment community to
\nget first hand information about the problems faced by investors
\nin the country, and to explain what measures should be taken and
\nwhat has been implemented.<\/p>\n
Rozy was speaking on the sidelines on an international forum
\non the privatization program.<\/p>\n
KEM, which is 90 percent owned by the giant Rio Tinto mining
\ngroup, has temporarily shut down its mining operation. Local
\npeople have blockaded the road into the site and the company has
\nbeen unable to deliver basic supplies including fuel and food to
\nits 1,500 employees since April 18.<\/p>\n
The local villagers have demanded compensation for the land
\nacquired by the company. KEM claims to have settled the dispute
\ntwo years ago, but they have received some 6,000 new claims from
\nlocal residents.<\/p>\n
Rozy said that his office would gather the necessary
\ninformation from related ministries to help resolve the KEM
\nproblem.<\/p>\n
\"We will gather complete information first. Our office is
\ninterested in the problem from the investment aspect,\" he said.<\/p>\n
Rozy added that he is scheduled to meet with the Minister of
\nDefense and Security Juwono Sudarsono today (Friday) together
\nwith the foreign investment community in Jakarta to help resolve
\nthe various problems encountered by foreign investors.<\/p>\n
\"We will respond to their concerns and complaints seriously,\"
\nhe said.<\/p>\n
Rozy was appointed to the current position late last month,
\nreplacing Laksamana Sukardi.<\/p>\n
He said that the ministry had been engaged in regular meetings
\nwith the foreign community and diplomats in a bid to help
\nmaintain and encourage foreign investment in the country.<\/p>\n
Foreign investment is seen as a crucial element to help the
\ncountry recover from the economic crisis that has gripped it for
\ntwo years.<\/p>\n
Unfortunately, persistent social unrest and security problems
\nhave plagued various parts of the country since the downfall of
\nformer president Soeharto and handling these problems in the new
\ndemocratic environment has required patience and understanding by
\nall parties. The problems and the slow pace and uncertainty of
\nnegotiations has created jitters to some investors.<\/p>\n
The launch of the new autonomy law giving greater power to
\nregional administrations also has created some confusion and
\nfears among businesses.<\/p>\n
Meanwhile Australian miner Rio Tinto said separately on
\nThursday that it would restart operations at its 14-metric-ton-a-
\nyear gold mine in East Kalimantan after local activists ended a
\nroad block that had cut off essential supplies to the mine and
\nforced it to suspend operations on May 6.<\/p>\n
Company spokesman Anang Noor said the protesters agreed
\nWednesday to further negotiations over their land rights claim,
\nbut he wasn't immediately able to provide details of any new
\noffer from the company.<\/p>\n
\"We have now started negotiating again,\" Anang told Dow Jones.<\/p>\n
The dispute is the latest in a string of clashes between
\nforeign resource companies and local communities in Indonesia,
\nwhere local authorities in several resource-rich provinces are
\ntrying to wrest a greater share of income from such companies.<\/p>\n
The East Kalimantan mine is owned and operated by PT Kelian
\nEquatorial Mining, which is 90 percent-owned by Rio Tinto and
\n10%-owned by local partner PT Harita Jayaraya.<\/p>\n
The protesters are demanding compensation from Rio Tinto and
\nthe Indonesian government for land they allege was taken from
\nthem in the late 1980s, the company said. They are seeking
\ncompensation of Rp 100,000 per square meter of land.<\/p>\n
Last week's suspension was the first time that Rio Tinto has
\nstopped production since it began operating the US$250 million
\nmine in 1992.<\/p>",
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"sponsor": "Okusi Associates",
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