Kalimantan governors vow to protect investment

JAKARTA (JP): In a bid to lure back prospective investors, governors of oil and mineral rich Kalimantan vowed here on Tuesday to protect business investment on the vast island.

Speaking at a forum for investment promotion organized by PT Harvest International, the governors of East, West, Central and South Kalimantan agreed that investment was the backbone of the island's development.

"We would like to express that we will protect the interests of investors ... because without investment it is impossible to develop Kalimantan," Central Kalimantan Governor Asmawi A. Gani said.

"I am certain that the government of East, West, Central and South Kalimantan will protect and serve the business interests of investors ... so with this in mind be assured that your interests will be protected," he added.

However, Asmawi did not elaborate on what kind of security arrangement was going to be implemented to secure business investments in Kalimantan.

East Kalimantan Governor Suwarna Abdul Fatah later told journalists that "so far no concrete measures have been taken" to tackle security problems in Kalimantan.

"It (a joint agreement between four governors on security) has not been discussed, but I agree that follow-up action on that should immediately be taken," Suwarna said on the sidelines of the forum.

City mayors in Kalimantan said recently in a congress that security in Kalimantan was at a historic low.

They said security personnel were unable to cope with communal clashes and mob attacks on state buildings and domestic and joint-venture companies.

Asmawi said that security problems in Kalimantan were "the result of 32 years of an authoritarian system".

"Local people feel that they have been robbed so they are now venting their anger on business interests, particularly those that come from outside Indonesia," he said.

Home to around 11 million people, Kalimantan is blessed with millions of hectares of tropical forest, abundant oil and gas, as well as mineral reserves, including coal and gold.

Foreign investment in Kalimantan has accumulated to a whopping US$11.5 billion since 1967.

Foreign investors in Kalimantatn include oil companies Unocal Corp. and Vico Indonesia -- both with operations in East Kalimantan -- gold mining firm Kelian Equatorial Mining (KEM), and huge coal miner Kaltim Prima Coal (KPC).

Domestic investment has been focused on forest concessions.

Earlier this year, road blocks by local villagers and a workers' strike had forced at least two foreign companies, KEM and KPC, to temporarily shut down their mining operations in East Kalimantan.

Clashes between Malays and Madurese settlers in the West Kalimantan capital of Pontianak, which flared up again late last month, were also a constant headache in Kalimantan.

Gruesome clashes pitting Malays against the Madurese settlers have erupted periodically in the region. Hundreds of people, mostly Madurese, were killed in 1999. Dozens also died in attacks in 1997.

The launch of the new autonomy law giving greater power to regional administrations has also created some confusion and fear among businesses.

The troubles in KEM and KPC were the latest in a string of clashes between foreign resource companies and local communities in Indonesia, where local authorities in several resource-rich provinces are trying to wrest a greater share of income from such companies. (byg)