Thu, 27 Oct 1994

Govt to award 40 mining contracts next year

JAKARTA (JP): The government will award some 40 new contracts for general mining activities early next year, Director General of Mines Kuntoro Mangkusubroto says.

"Of the number, 10 contracts will deal with the exploration and production of gold in various parts of the country," Kuntoro told reporters during a break of the fourth Asia-Pacific Mining Conference and Exhibition at the Jakarta Hilton Convention Center yesterday.

He said that most of the potential 40 contractors, which will deal with mining exploration and production in eastern provinces, are affiliated with large international business corporations.

"One of them is the giant mining company Anglo American Corporation of the United States, which has applied for gold exploration rights in East Kalimantan and Irian Jaya," he said.

In August, the government awarded five working contracts to foreign companies for gold exploration in Irian Jaya, North Sulawesi and North Sumatra. It also gave 19 new contracts to domestic and foreign companies for general mining activities in the country.

Kuntoro said the increase in the number of companies applying for mining exploration indicates the good investment climate in the country.

"At least three factors have encouraged foreign investors, including the government's law consistency, good incentives and economic and political stability," he said.

He assured reporters that many foreign investor have seen that the bureaucracy and business climate in mining exploration in the country is proactive.

In terms of incentives, Kuntoro said that the government will introduce a new taxation scheme which will better benefit investors doing business in the eastern part of the country.

"I cannot give details of the incentives because they are all included in the new tax laws being effected early next year," he said.

Most attractive

B.N. Wahju, secretary general of the ASEAN Federation of Mining Associations (AFMA), meanwhile concurred that according to his association's studies, Indonesia is the most attractive place for foreign investments among the Asian countries.

"It is because of the economic stability and the availability of enormous natural resources in the country," he told The Jakarta Post yesterday.

"We now rank 10th among the most attractive countries for investments in the world," he said, adding that Chile ranks first place.

During yesterday's seminar, Kuntoro reported that the country's revenues from mining exports last year reached $1.55 billion, up from $1.44 billion 1992, $889 million in 1991 and $636 million 1990.

The four day mining conference and exhibition, which was officially opened by Minister of Mines and Energy I.B. Sudjana, was organized by the ASEAN federation of mining associations (AFMA) in cooperation with worldwide mining institutions.

Around 150 experts of Asia, the United States and European countries are attending the conference and exhibition.

The forum, which carries a theme of the World Mining Challenges to the Next Century, cover various issues including mineral policy, mining technology, coal and mineral development, mineral processing, taxation and investment, mining regulation and environment, while its exhibition displays mining equipment and technology from Canada, Australia, Singapore, Germany, Malaysia, the United States, Russia, China, Italy and Indonesia. (fhp)