Indonesian Political, Business & Finance News

Govt allows mining firms back into protected areas as investment lure

| Source: JP

Govt allows mining firms back into protected areas as investment lure

Fabiola Desy Unidjaja/Fitri Wulandari, The Jakarta Post, Jakarta

The government has issued a regulation in lieu of law (perpu)
that will allow 13 mining companies to resume their operations in
protected forests in a bid to provide legal certainty for
investors.

The decision was greeted by protests from environmental
activists, who said it would open the way for the further
destruction of the country's natural resources.

Coordinating Minister of the Economy Dorodjatun Kuntjoro-Jakti
said it was decided during a Cabinet meeting on Thursday to issue
Perpu No. 1/2004 to address the issue of mining concessions that
overlap with protected forests.

"The 13 mining companies will be allowed to resume their
mining activities because they have proven reserves and are
economically viable," Dorodjatun said after the meeting.

He added that the decision was aimed at providing certainty to
investors in a bid to increase the sluggish investment in the
mining sector.

President Megawati Soekarnoputri led the meeting, which was
also attended by Minister of Law and Human Rights Yusril Ihza
Mahendra, Minister of Energy and Mineral Resources Purnomo
Yusgiantoro and Minister of Forestry M. Prakosa.

In the country's legal system, a perpu is equal to a law and
is normally issued in cases of emergencies in order to avoid the
lengthy process of law making, which involves the House of
Representatives. A perpu immediately takes effect and remains so
until the House approves a law to replace it. The government may
also propose the perpu as a bill.

The 13 mining companies to be affected by the perpu are among
22 mining firms that appealed to the government to be allowed to
resume their operations in protected forests following the
implementation of Law No. 41/1999 on forests banning open-pit
mining in protected forests.

The remaining nine companies will not be given licenses to
resume their mining activities in protected forests because no
proven and economically viable reserves have been found in their
areas.

The 22 firms received contracts from the government several
years ago before the law on forests came into effect, and their
concession areas were not designated as protected forests at the
time the contracts were signed.

The names of the 13 mining companies affected by the perpu was
not available on Thursday.

Lambock V. Nahattands, deputy state secretary for legal
affairs, said the government regulation basically added a new
article to Law No. 41/1999 on forests.

"The new article, 83a, says all mining licenses and agreements
in forests that were in place prior to the imposition of Law No.
41/1999 will remain in effect until the agreement or license
expires," Lambock said.

He said the perpu would be submitted to the House as a bill,
and that the government would issue a presidential decree on the
13 mining companies.

Environmental activists who had fought to prevent the issuance
of the licenses protested the decision.

Longgena Ginting, executive director of the Indonesian Forum
for the Environment (Walhi), said the government not only
violated its own law but also the global commitment to stop the
destruction of biodiversity.

"We regret the decision. It is the legalization of the
destruction of natural resources," Longgena told The Jakarta
Post, adding that Walhi would take legal action against the
decision and hold an international campaign to protest the move.

Government to issue forest crime law

The government will issue a government regulation in lieu of
law (perpu) to deal with illegal logging in an emergency measure
to stop the rapid destruction of the nation's forests.

Minister of Forestry M. Prakosa said the new regulation would
become a special law on illegal logging outside the current
criminal law.

"Illegal logging has become an acute problem. Efforts to stop
illegal logging have been hampered by inadequate laws that cannot
provide a fast solution or proper punishment to the culprits,"
Prakosa said after a Cabinet meeting on Thursday.

The perpu will enable law enforcement officials to try illegal
loggers immediately after they are arrested, and will allow
authorities to confiscate materials used in the crime, including
any vehicles or boats used to transport illegally cut logs.

The regulation will also contain severe punishments for those
involved in illegal logging.

"All parties involved in illegal logging are considered forest
terrorists. That is why the punishments should match those for
terrorism," he said.

Prakosa said a team was now discussing the special law on
illegal logging, and expected it to be issued soon. -- JP

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