Modify the Freeport contract

The case involving Freeport Indonesia, the world's largest gold and copper mining company with operations in Irian Jaya, continues to be a subject of public debate. Freeport is accused of not only contaminating the environment in which it operates, but of ravaging it. In addition, its revenue has not significantly benefited the government or the people of Irian Jaya in terms of taxes, royalties and dividends.

At the center of the current debate, however, is the company's alleged failure to take responsibility for the destruction of the environment and the charges of corruption, collusion and nepotism that mar its operating contract with the government.

The gigantic gold mining company -- an American investment project -- has meanwhile made efforts to correct its oversights. It has, for instance, donated US$1.27 billion (between 1991 and 1998) to the government. A sum of $5.6 billion was made available for paying employees, purchasing domestic Indonesian products and reinvestment. That means that about 87 percent of its revenue remained in Indonesia. And the damage to the environment covers a total area of only 13,000 hectares -- not 30,000 as reported by the Indonesian Environmental Forum. There also were no human rights violations committed by the company.

The current demands that the government abrogate the Freeport contract and the various complaints that accompany this demand result from the fact that for about a decade the company seemed to have enjoyed the protection of the New Order government against any criticism and accusations. We support the view that the Freeport contract and contracts with other companies should not be abrogated. Rather, amendments should be made to those clauses in the contracts that do cause problems.

-- Suara Pembaruan, Jakarta