Freeport needs to adjust approach to social issues

JAKARTA (JP): Minister of Environment Sarwono Kusumaatmadja yesterday revealed that initial reports of a social audit of PT Freeport's activities in Irian Jaya show that the mining giant still needs to make adjustments in its dealings with the local population.

"Based on the auditors' preliminary report, Freeport needs to make corrections in its handling of social issues in its surrounding areas," Sarwono told journalists after reporting the initial findings of the audit to President Soeharto.

He added that the government will establish pointers on social programs on which Freeport could base their own programs.

"The government's task is to provide a guide for Freeport and other investors in the context of running their social programs," Sarwono said.

The New Orleans-based company currently runs one of the biggest copper and gold mines in the world. Over the past few months, there has been some unrest surrounding the mining area in Timika regency, which some locals and observers allege was the results of inequalities created by the Freeport mine.

The audit on the impact of PT Freeport Indonesia on its social environment, conducted by international auditors Labat and Anderson, was expected to be released sometime last month.

Sarwono yesterday explained that the full audit would take longer then expected, since the issue is extremely complex.

An environmental audit by Dames and Moore issued in April concluded that PT Freeport is an environmentally conscious company. The environmental audit also gained the immediate backing of the Ministry of Environment.

Sarwono noted that the lack of guidelines for social activities is a missing ingredient which would help foreign companies when encountering such situations as those in Irian Jaya.

"We can't let them operate and conduct things based merely on their own perceptions. That is what creates the problem," he said.

He asserted, however, that the government has no intention whatsoever of closing the company's operations in Irian Jaya.

Sarwono also said that the preliminary report of the social audit has found that the root of the problem lies in the fact that a multinational and modern company like Freeport conducts its activities in the middle of a traditional society.

"Freeport's neighbors are our brothers, the local inhabitants whose level of civilization is still very simple. That's the core of the problem," the minister said.

The report also found that the government's limited presence in the area was one of the reasons for the lack of a conducive climate to promote better understanding.

"The government's position (there) is still very weak, since it is only represented by a district chief," he said.

In an administrative reorganization, the government has announced that Timika will be elevated to become an administrative regency.

Speaking on the continued presence of the military apparatus there, Sarwono maintained that it was needed to maintain order in the region.

"Without the presence of the military, nothing could be done," he said. (mds)