Mining powers transferred to provincial administrations
Mining powers transferred to provincial administrations
JAKARTA (JP): Central government will authorize some
provincial administrations to supervise the mining industry in
their respective areas on a temporary basis, as the regencies
there are thus far considered not ready to carry out the job, a
senior official of the Ministry of Energy and Mineral Resources
has said.
Under Autonomy Law No. 22/1999 and the Intergovernmental
Fiscal Balance Law No. 25/1999, both of which took effect as of
Jan. 1 this year, regency administrations took over mining
supervision from central government.
But, Wimpy S. Tjejep, the director general of geology and
mineral resources, said many regencies were not yet ready to take
over mining supervision due to lack of skilled human resources
and modern infrastructure.
"In such a situation, the supervision of the existing mining
contracts will be carried out by the provincial administrations
on behalf of the central government," Wimpy said Monday evening
following a business dinner entitled "Indonesian Mining Policy in
the Era of Regional Autonomy. Resolving the Uncertainties",
organized by mining and oil news provider Petromindo.Com.
The implementation of regional autonomy has caused confusion
among mining investors given the fact that the autonomy law is in
conflict with previous Mining Law No. 11/1967 that gives the
central government the right to manage the mining industry.
Mining investors are also concerned with the fact that many
regencies lack skilled human resources and modern infrastructure
to carry out the supervision.
Some 20 foreign and local mining companies have reportedly
suspended their operations, citing the uncertainties arising from
the implementation of the autonomy law.
Many banks have also reportedly declined to channel loans to
mining firms wishing to invest in the country for similar
reasons.
Wimpy said the government's policy to give the provinces
rights to supervise the mining industry was expected to be able
to address the investors' concerns.
"So far, there is no problem. We hope the regency
administrations can accept the policy," Wimpy was quoted by
Antara as saying.
Wimpy did not name the provinces that will be authorized by
the government to carry out the mining rights.
Legislator Emir Moeis, who is a member of the House of
Representatives Commission VIII for environmental, science and
technology affairs voiced support for the government's policy.
"The policy has a positive goal. It is the best solution for
the transition period," he said.
Under the autonomy law, regencies can issue mining permits and
regulations and receive 80 percent of mining royalties. (03)