What has gone wrong with PT Freeport?

Freeport, the giant mining company which operates in Irian Jaya, has been in the news in recent months following a riot in Timika. T. Mulya Lubis suggests that the company take into account the locals' need and aspirations and change its approach.

JAKARTA (JP): The Freeport mining company is as old as the New Order government. It set foot in Indonesia in the mid 1960s.

The new government was still in its infancy then and there was no foreign investment law. Hence, the giant American company was given a big concession, which no successive investors have ever been granted.

Freeport's investment was 100 percent foreign at the start. The company was also not subject to Law No. 1 of 1967 which stipulates a 30-year mining concession.

Because of the remote location of PT Freeport Indonesia, the public is hardly aware of the goings on there and how much wealth has been extracted from Irian Jaya soil.

Hence, people say Freeport is "untouchable" or "a state within a state". These allegations are incorrect, but they do reflect a perception of the company's secrecy.

People find it ironic that a foreign company so big, rich and arrogant can offer so little benefit to the local people.

Freeport has undoubtedly contributed large proceeds to the state coffers. Two local shareholders, PT Indocopper Investama and the Indonesian government, now have a share of less than 20 percent in the company.

The company provides employment to Indonesians and has contributed to the improvement of human resources by sending employees abroad for studies.

Nevertheless, it is also true that Freeport has caused many environmental related problems and has alienated the Irianese. Complaints that Irianese are not given the same opportunities offered to people from outside Irian Jaya have given rise to outcries of unequal treatment.

Some say that the outdated American doctrine of "separate but equal" has found a new life in Freeport.

The grievances reflect the powerlessness of the locals not only in Freeport but also in transmigration projects and in government offices. The government found that excesses which did occur were committed at the level of execution and it took measures to improve the situation.

However, there are a lot more things to be done. We have to ask ourselves about the separatist movements and the break up of various social incidents, whether all that is the result of a social gap and an error in our policies?

Is centralization to be blamed because the province was run as if it could be controlled by a "remote sensing" device from Jakarta? Is there no autonomy at all in Irian Jaya?

In this context all of us, including Freeport, have to open our minds and do more for the Irianese community. Compared to 30 years ago, Irian Jaya is increasingly more open and sooner or later more information will flood into the province.

Communication technology has lifted many taboos. Therefore, equal work opportunities and environmental improvement must be central in the issuance of policies.

Environmental improvement cannot be done by merely placing advertisements in newspapers, and there is more to it than just preventing degradation and pollution.

It is no exaggeration to say that the environmental audit by the reputed environmental audit company Dames and Moore is far from adequate. Environmental improvement cannot be separated from social environmental betterment. Freeport has no significance if it makes the community feel like strangers on their own soil.

This constitutes a challenge for Freeport, and many people feel that the company falls short of the challenge. Not everyone is of this opinion though.

Recently a tribal leader filed a suit against Freeport headquarters with the New Orleans district court, although the suit was later withdrawn.

The US$ 6 billion suit questioned Freeport's operations which allegedly destroy the environment and stifle culture and human rights. It is interesting that reference was made to ecoterrorism and cultural genocide.

It reflects the magnitude of the problems. The largest environmental organization in Indonesia, the Indonesian Forum for Environment (Walhi), has also filed a suit against Freeport in the same district court. This suit will push all sides, especially Freeport, to take wiser, farsighted measures.

To seek profit is the essence of capitalism, but capitalism cannot grow if the soil in which it is invested does not accept it.

Times have changed. Distance is no more a problem. Even boundaries cannot prevent a civil suit from being filed. Furthermore, public relations are no more the monopoly of multinational companies. NGOs can also effectively employ public relations, both at national and international levels.

Whoever thought that an Amungme tribal chief would engage a lawyer in the United States to sue Freeport? Whoever considered that an organization like the Indonesian Forum for Environment would have the pluck to sue Freeport at its home base?

This new era demands change. Freeport can no longer be a "foreign company" amid the people of Irian Jaya.

It is time for Freeport to give more to the Irianese so that its presence is beneficial to the community. If Freeport were to grant 1 percent of its revenues to Irian Jaya it should not be seen as charity.

In corporate language the term "corporate social responsibility" is known, and it is this concept that must be translated into concrete action. The Irianese are not against foreign companies, but resentment is there and will become stronger against foreign companies which alienate themselves.

Let us hope it is not too late to change the situation.

The writer is a noted human rights activist and a corporate lawyer based in Jakarta.

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