Plantation firms told to return disputed land

JAKARTA (JP): President Abdurrahman Wahid, popularly known as Gus Dur, has instructed state owned plantation companies to return some 40 percent of land taken by force or bought at unfair prices from local people in the past.

Gus Dur said in a statement distributed following a late Monday cabinet meeting on the economy, that the plantation firms could return the land physically or provide shares to the affected people.

According to the statement, the President stressed that this policy only applies to land which involves legal problems.

The statement said that the new government was aware that some of the land owned by state-owned companies or private companies had been seized unfairly from the people and had caused problems in the past.

It's no secret that many state enterprises and politically well-connected conglomerates had used force and intimidation to acquire land from people at prices far below market value during the previous authoritarian government of Soeharto.

The statement also said that Gus Dur supported efforts by the Minister of Mines and Energy Susilo Bambang Yudhoyono to "legalize" the illegal mining activities which were mostly conducted by traditional miners.

"This will help avoid conflict between the people's mining and huge scale mining," the statement said.

Gus Dur has also agreed to demands from the West Sumatran people to spin off PT Semen Padang from the state-owned cement maker PT Semen Gresik on grounds that the former was built on heritage land.

The statement said that Gus Dur had ordered State Minister for Investments and State Enterprises Development Rozy Munir to make a valuation of Semen Padang's price to be used as a basis for negotiation with Mexico's cement maker Cemex SA de CV.

Semen Gresik owns up to 46 percent shares in Semen Padang.

Cemex has a 25 percent stake in the publicly listed Semen Gresik. The company has plans to increase its Semen Gresik stake to around 40 percent.

The government had to drop plans to sell a majority stake to Cemex in 1998 following widespread protests from the West Sumatran people.

The President has also ordered the Coordinating Minister for Economy, Finance and Industry Kwik Kian Gie to study the "Blue Sky" project designed by the Ministry of Mines of Energy to help significantly reduce the lead content in fuel products.

Gus Dur said that Kwik must also decide the source of financing and its mechanism for the project.

The cabinet meeting also concluded that the lending procedure for export oriented industries must be eased down in a bid to help recover the country's embattled real sector.

In an effort to boost the country's exports, Gus Dur has instructed Kwik and Finance Minister Bambang Sudibyo to coordinate with Bank Indonesia and the Indonesian Bank Restructuring Agency (IBRA) to seek ways to take advantage of some Rp 700 trillion worth of excess liquidity in the banking sector to help finance the export industries.(rei/byg)