Demands of local people unavoidable, says mining body
Demands of local people unavoidable, says mining body
JAKARTA (JP): The increasing number of provinces making
demands on mining companies is unavoidable and is a consequence
of the transition into democracy, the Indonesian Mining
Association (IMA) said on Thursday.
IMA executive director Paul Coutrier said mining companies
should therefore act wisely in facing the demands of the local
people.
"We have to accept the fact that people now have the courage
to protest," Paul said in a news briefing.
He said these demands were suppressed for 30 years under the
authoritarian rule of former president Soeharto.
"That the once so friendly neighbor starts to complain about
the waste we produce is normal," Paul added.
Since the downfall of Soeharto in 1998, many mining companies
have been wrestling with demands made by regions concerning
taxes, environmental issues and land concessions.
Local discontent, however, stems mostly from social economic
problems rather than environmental, he added.
He said people felt they had benefited little from the
economic activities of large companies operating in their area.
He said mining companies paid all the royalties and taxes to
the central government without knowing what the money would be
used for.
"There was no control," he said, adding that control called
for good governance which was lacking under Soeharto's rule.
But with autonomy to be implemented next year, provinces down
to regencies and districts will gain a greater share from the
revenue in royalties paid to the government.
Law No 25/1999 on intergovernmental fiscal balance stipulates
that provinces get 80 percent of the government's revenue from
mining royalties.
He urged mining companies to listen to locals' demands and
avoid suppressing people's voices.
"Otherwise, how are we ever to find out what to improve?" he
asked.
He said that because of the demands, mining companies had
become better aware of the needs of their surrounding
communities. Nevertheless, Paul warned that the transition into
democracy could also be violent.
He said the government should act firmly on people who use
force to press companies into succumbing to their demands.
"Democracy has rules," he said.
He cited that locals had gone too far in the case of gold
mining company PT Kelian Equatorial Mining (KEM).
KEM had to suspend operations after locals blockaded the only
supply road leading to its gold mine in East Kalimantan,
demanding the company pay them compensation for their land.
According to Paul, since KEM had paid land compensation in
1990 and 1994, he feared the locals would continue making the
same demands.
"When will this stop?" he asked.
Last week the Ministry of Mines and Energy's Director General
of Mining Surna Tjahja Djajadiningrat told mining companies to be
more flexible in facing vocal provincial administrations.
He said mining companies should be able to make compromises in
seeking a win-win solution when faced with such local
authorities. (bkm)