IMA urges lawmakers to amend forestry law

IMA urges lawmakers to amend forestry law

Rendi A. Witular, The Jakarta Post, Jakarta

The Indonesian Mining Association (IMA) has urged the House of
Representatives and the government to continue with plans to
amend the forestry law to boost investment in the mining sector.

IMA chairman BN Wahju told The Jakarta Post on Tuesday the law
had prompted some mining companies to hold off their investments.

He acknowledged that the association had lobbied the Ministry
of Energy and Mineral Resources to push lawmakers to revise the
law, which bans open-pit mining in protected forest.

Some 22 mining companies had been awarded mining contracts
from the government and had made investments before the law was
put into effect in 1999.

"The law is inapplicable, it only hurt investor confidence.
Our main point is that the government should honor the contracts
they made with mining investors," said Wahju.

Many mining companies that invested millions of dollars for
exploration activities prior to the issuance of the law were
infuriated when the government stopped their operations in areas
later designated as protected forests.

Wahju said the banning of open-pit mining was unacceptable
because other methods could not be used in certain mining
activities, such as coal and nickel mining operations.

As an example, he said that closed-pit or underground mining
could cause an avalanche.

However, chairman of non-governmental organization Mining
Advocacy Network (JATAM) Chalid Muhammad challenged Wahju's
argument, saying that banning open-pit mining in protected
forests was crucial to save the country's natural forest
resources and protect the environment.

Chalid said that the reason mining companies preferred open-
pit mining was because it enabled them to greatly minimize their
investment costs.

He also said that mining companies had not shown any goodwill
to protect the forest and the local environment.

He said that there should be a law forcing mining firms to be
responsible for restoring the condition of the forest.

However, Wahju added that mining companies should not be
solely blamed for accelerating the deforestation process as the
sector only occupied a small area of forest compared to those
controlled by timber concessionaires.

On concern over the negative environmental impact of open-pit
mining, he said that mining companies had prepared measures to
prevent toxic materials from damaging the environment.