by Andi Abdussalam
Jakarta, Nov 27 (ANTARA) - The collapse of the Mahakam bridge should serve as a lesson for Indonesia which is planning to construct its longest bridge that will connect Java and Sumatra on the Sunda Straits.
Indonesian engineers expressed concern over the collapse on Saturday of Indonesia's 10-year old Kutai Kartanegara bridge which spans 710 meters over the Mahakam river in East Kalimantan.
Reportedly built with a high technology and has a suspended section of 270 meters over the river, the bridge collapsed at 4.30 pm local time when traffic was busy on it.
"All parties involved, beginning from its designers, contractors and operational period, must be held responsible. The incident must be investigated thoroughly to disclose whether it has been built based on the required construction standards," Chairman of the Indonesian Engineers Association (PII) Said Didu said.
Therefore, the PII said it was ready to help the government conduct an investigative auditing of the bridge which connects the sub district of Tenggarong Seberang and Kutai Kartanegara district with East Kilamtan provincial capital of Samarinda.
Minggu, 27 November 2011
Sabtu, 26 November 2011
JAKARTA ALERTED OVER POSSIBLE MASSIVE FLOODING
| by Andi Abdussalam |
Jakarta, Nov 26 (ANTARA) - With the current rainy season expected to peak in January and February, Jakarta city authorities have been called upon on to prepare for possible massive flooding and take steps to minimize its destructive impact if it happens, The president made the statement in a limited cabinet meeting on climate change also attended by Jakarta Governor Fauzi Bowo. Yudhoyono said Jakarta was hit by floods every year. Therefore, he asked the Jakarta government to prepare various steps to anticipate floods. "I am confident the Jakarta governor has taken the anticipatory steps," the president said. The president asked the people to take a lesson from the experience of several neighboring countries in Southeast Asia, like Thailand and others, which were hit by floods. Therefore the relevant ministries have also prepared steps so that floods, if they take place, would not have impact and last for long like those taking place in Thailand. Social Affairs Minister Salim Segaf Al-Jufri said the government had made preparations to face the possible major floods in Jakarta. "All relevant ministries have made preparations for floods, not only in Jakarta but also in other regions in Indonesia. After all, the rain falls in January and February are high. So, we have to make preparations so that it would happen like in Thailand," Minister Salim said. He said his ministry had prepared emergency funds, inflatable and salvaging boats. Besides, a total of 1,250 rescuers are alerted in Jakarta and more than 30 thousands others all over the country. "We are doing our best so that the victims could be well safeguarded when there are floods," the minister said. Especially in the face of the fiver yearly cycles of big floods in Jakarta, the Jakarta government said it had made preparations even since 2008, such as dredging rivers and cleaning sewage. Head of Jakarta Public Work Service Ery Basworo said his office had allocated a fund for cleaning 144 rivers and sewages every year in Jakarta. In 2008, 12 rivers were dredged while in 2009 the same thing was also done on 64 rivers. Last year, six rivers were dredged and cleaned of refuse clog. "The main cause of floods in Jakarta is garbage that clogged the sewage system and rivers. Therefore, the regional government also called for the participation of the people," Ery Basworo said. Besides, the Jakarta public works service also is also preparing at least 646 flood task forces which are deployed in a number of flood prone areas in Jakarta. It has also made available at least 334 units of water pumps with a capacity of 358.7 cubic meters per second in 121 flood prone locations, 17 pick-up trucks, 25 units of Beco heavy equipment, 32 mobile water pumps, 38,500 sand bags, 6 rubber boats, he said. According to Ery Basworo, the equipment needed to overcome floods is now ready for operations in five areas of Jakarta in the current rainy season. "The Jakarta Public Work Service has conducted monitoring and detection on flood locations in Jakarta in the run-up to the rainy season," he said. Regarding the widening of rivers and dams, Ery said his office would be assisted by the central government in widening five rivers from six meters to 22 meters. "Besides, narrow culverts would also be widened. Those previously having a diameter of 60 cm are now replaced with those with a diameter of 1.8 meters," he said. Ery said that the rivers that would be widened included the Sunter, the Cipinang, the Grogol, the Krukut and the Pesanggrahan. "The width of the five rivers is only six meters. We plan to widen it into 22 meters with a length of 35 km for each of the rivers," Ery said. House Speaker Marzuki Alie appreciated the various efforts by the regional government of Jakarta and the people made to anticipate floods in the capital city as a result of increasing rain falls which is expected to take place next month. "The House hails the regional government and people's efforts to face floods such as the cleaning and the construction of walls on the brink of River Ciliwung and floods safeguarding simulations," the House Speaker said. Marzuki said Jakarta as the capital city is the center of government, economic activities and the activities of state institutions. Therefore, Jakarta should be free from floods because the disaster would disturb the government and people economic activities. "If the construction of the east and west flood canals have almost been completed, revitalization of dams and 13 rivers which crisscross Jakarta should be carried out soon, including the Ciliwung river" Marzuki Alie said.***6**** |
Jumat, 25 November 2011
RI FACING CRITICAL PERIOD IN INFRASTRUCTURE DEVELOPMENT
| by Andi Abdussalam |
Jakarta, Nov 25 (ANTARA) - The coming three years will be a very critical phase for Indonesia in the development of its infrastructure as it would only have two options, namely developing fast and strategic infrastructures or being trapped in structural and prolonged congestion. The next three years until 2014 will be crucial for Indonesia's infrastructure development. However, observers see that the government still has no solid policy in the field that would support the development of its infrastructures. "The government's latest policy in this sector such as a master plan for the acceleration and expansion of Indonesia's economic development (MP3EI) has not yet been prepared well in the field," Suyono Dikun, a professor at the University of Indonesia, said on Thursday. Failure to develop enough infrastructures in the country will cause congestion in different sectors, not only in the traffic one. "The congestion will happen not only on roads but also on railway tracks, ports, airports, power energy, irrigation, drinking water and others," Suyono said. He said that if Indonesia failed to develop more modern, efficient and quality infrastructure in the coming few years, it would lag far behind other nations. Legislator Rhendy Lamadjido and expert staff of the ministry of public works Danang Parikesit shared Suyono's view. Suyono, who is also a former deputy to chief economic minister for infrastructure pointed out that institutionally the government had basically tried to do its best to develop infrastructures such as through the Policy Committee for the Acceleration of Infrastructure Development Preparations (KKPPI) and the issuance of various presidential regulations such as Presidential Regulation No. 81/2003, Presidential regulation no. 42/2005 and No. 12 / 2011. "Presidential Regulation No. 13/2010 on Public Private Partnership (PPP) has also been revised with presidential Regulation No. 56/2011, yet the long efforts made in the span of 10 years have not yielded an encouraging result," he said. Sharing Suyono's view was legislator Rhendy Lamadjito of the House Commission V on public works affairs. He said that Indonesia's infrastructure development was now entering a critical period. Rhendy said that so far there was something wrong with the budget policy on infrastructure. He cited as an example tenders for infrastructure projects. Tenders were called in June-July while their contracts were signed in August, only after which could the budget be disbursed. "To make this more complicated difficult is the fact that there were post-fasting month and Christmas activities, while at the same time the budget year and disbursement were limited to the year-end," he said. As a result according to Rhendy who is also chairman of the National Construction Services Development Institute, it is quite understandable if the absorption of public works budget in the infrastructure sector only reached 50.8 percent, leaving about 1,500 more infrastructure projects in the ministry not implemented. "Players in the field also face a problem of interest rate where they need soft interest policy so that it is urgent in this respect for the government to consider establishing a construction bank," Rhendy said. The situation was also worsened by new policies issued to accelerate infrastructure development such as the Public-Private Partnership (PPP) and the Master Plan for Acceleration and Expansion of Indonesia's Economic Development (MP3EI). It turned out that these policies had no strong legal basis such as law. "This is why it is difficult for foreign and domestic investors to enter infrastructure projects," he said. Rhendy said that the other important thing was the fact that many legal products and other regulations had been issued but the government was inconsistent in its implementation, such Law No. 18/1999 on construction Services. Expert Staff of the Public Works Minister, Danang Parikesit said that what the government expected in issuing a number of polices such as the PPP and MP3EI could not yet be realized as the scems could not be implemented in the field. "Initially in November 2009 the MP3EI was only an idea, along with the idea of economic corridors, yet in May-June this year it was decided as a policy that has to be carried out while the instruments and strategies for its implementation in the field not yet existed. Only now does the government formulate it," Danang said. Therefore, the government needs to stress the MP3E and PPP, whether they are merely re-branding or they are needed to boost development. "If they are only for re-branding, there is no need to support them with a law," he said. Regarding the critical situation in the coming three years, Danang said it was in the context of comparing it with other countries."Yet, in the real sense, the Indonesian infrastructure is basically growing," Danang said. In term of infrastructure development financing where the state budget is expected to provide 30 percent while the private sector is expected to contribute 70 percent, Danang said that if the 30 percent financing is carried out in the right way and transparently, the private sector would contribute the70 percent easily. Some time ago, an estimate made by the Indonesian Chamber of Commerce and Industry (Kadin) showed that Indonesia will need Rp2,855 - Rp2,910 trillion to finance its infrastructure development in the 2010 - 2014 period. The government since recent years has the commitment to stimulating investment in infrastructure development in order to boost economic growth to about 6-7 percent by 2014. The government hopes for a total investment of Rp2,000 trillion while actually it will have an investment of about Rp1,600 trillion in the next five years in order to achieve the growth target. Owing to the big investment needed to develop infrastructure, the government has to promote its infrastructure development to the private sector as it could only finance 30 percent of the total funds needed for the projects. About 70 percent of the infrastructure projects are expected to be financed by private companies, among others through a private public placement (PPP) scheme.***5*** |
Minggu, 20 November 2011
RI RICE PRODUCTION BELOW TARGET
| by Andi Abdussalam |
Jakarta, Nov 20 (ANTARA) - Indonesia is expected to import rice to cover its rice shortage as its production this year is estimated to be below the target due to unfavorable climate and planting pattern changes. "A third rice production forecast by the central board of statistics puts the figure at 65 million tons. If in the coming two months (November-December) improvements can be made, the figure could be 66 million tons. This means we will still miss our target by 4 million tons," Deputy Agriculture Minister Rusman Heriawan said over the weekend. The government has set a production target of 70 million tons of unhusked rice in 2011. But the country's rice production is likely to reach only 66 million tons of unhusked rice which would be below the targeted figure of the 70 million tons. According to the deputy minister, it is difficult to say at present that the target would be met because of the changed planting pattern as a result of climate change. The deficit of four million tons could only be covered in the 2012 harvest season. "The planting pattern is changed so that four million tons are to be harvested in 2012," he added. However, the target of 74 million tons next year is achievable. "I have calculated that in 2012 we will see a production increase, perhaps an extraordinary one," he said. Rice is the main staple food in the country with a population of about 237.6 million. Its annual rice need reaches 33 million tons. In order to cover the shortage of rice stocks at the end of this year the government will still import about 500 thousand tons to meet its need for the staple until the end of 2011. President Director of state-owned logistics agency Bulog, Sutarto Alimoeso, said the Indonesian government was importing an average of 250 thousand tons of rice each month. "Based on our calculations, Indonesia needs 500,000 additional tons of imported rice to meet domestic needs until the end of the year," he said. The calculations had passed a series of analysis by various parties in a number of meetings held at the finance ministry. "The volume to be imported is ultimately to be decided by the government but according to our calculations, we need approximately 500,000 more tons," he said. With the addition of 500,000 tons, Bulog was convinced the national rice stocks would be enough for the coming five months which would aggregate about 1.8 million tons. He said that up to now, Indonesia had already imported a total of 700,000 tons from Vietnam and Thailand. Based on data available at the Central Board of Statistics (BPS), Indonesia's total rice imports through several ports in the January - September 2011 period have reached 1.870 million tons. As per October 2011, Bulog alone has imported 536 thousand tons of rice or less than a half of the 1.2 million tons Indonesia had contractually intended to buy from Vietnam. Meanwhile, the government has canceled earlier a plan to import 300 thousand tons of rice from Thailand. According to Rusman Heriawan, the Indonesian government has so far imported rice from Vietnam and Thailand as the biggest rice exporting countries. Yet, the floods that hit Thailand have made Indonesia to seek another rice exporting country which has enough rice reserves like India. "It is now difficult to find countries which want to export rice, even, rice exporter countries now are imposing complicated requirements," he said. But Trade Minister Gita Wirjawan said on Saturday that Thailand and Vietnam have signed a new agreement to export rice to Indonesia. "Thailand will remain exporting 300,000 tons of rice to Indonesia this year," Gita Wirjawan said on the sidelines of the 19th ASEAN Summit at Bali International Convention Center in Nusa Dua on Saturday. In the meantime, Indonesia and India have not yet completed their negotiations on the plan of Indonesia to import 500,000 tons of rice from that country. Until now, both sides have not yet reached an agreement, while negotiations are still continued. "India asked for too rigid requirements. India has enough rice reserves and this is for the first time Indonesia is willing to cooperate in the rice import with India," Rusman said. He said the Indonesian government was facing difficulties in importing rice because Thailand as a main rice supplier country to Indonesia was experiencing a production decline by about 10 to 15 million tons due to the floods. "Thailand is of course willing to reinforce its food resilience following the floods," Rusman said. Yet, Trade Minister Gita Wirjawan disclosed on Saturday that Thailand along with Vietnam had renewed its commitment to exporting rice to Indonesia Gita explained that although Thailand was hit by devastating flood recently, the country would supply rice to Indonesia, and committed to supplying 1 million tons of rice per year from 2012 to 2016. The renewal of the commitment assured that the needed to import rice this year could be met. After all, according to Rusman, it is impossible for Indonesia to import rice from Japan, South Korea, China and the United States because rice from these countries were too expensive. In addition, Indonesia is also still negotiating rice imports from India. According to Bulog Chief Sutarto Alimoeso, rice imports from India are expected to arrive in Indonesia next month. "Hopefully, the imports will be arriving early in December. We have agreed to import 250,000 tons," Alimoeso said last Thursday. He said that the imported rice would be used to increase Bulog's rice stocks. "It is for a standby stock in the face of a possible rice crisis up to four months ahead," Sutarto Alimoeso said.***5*** |
Sabtu, 12 November 2011
SEA GAMES EXPECTED TO PROMOTE RI TOURISM
| By Andi Abdussalam |
Jakarta, Nov 13 (ANTARA) - The on-going 26th Southeast Asian Games is expected to help promote Indonesia's tourism, particularly the tourism development in Jakarta and Palembang which host the region's biggest sport events from November 11 to 22, 2011. Indonesia is hosting the 26th SEA Games where 296 sport branches are be competed in Palembang and the other 266 branches in Jakarta. The activities will also develop the creative economic sector and promote the country's culture and tourism in the wide sense. "Creative industry will develop significantly through sports events of this kind," the minister said. The same view was also expressed by the home affairs promotion director of the Tourism and Creative Economic Ministry Muhammad Faried said. "This event will be a very effective tourism promotion media," Muhammad Faried said. The minister said that the arrivals of many visitors to Jakarta and Palembang as the hosts of the SEA Games should be taken as an advantageous opportunity to promote Indonesia's tourism. Mari Elka Pangestu said that the biggest Southeast Asian Games were effective in promoting the Indonesian tourism while developing the creative economic sector. The turnover of the MICE (Meeting, Incentive, Conference and Exhibition) sector like those of hotels and meeting convention halls will also be boosted during the SEA Games events. During the events, athletes, officials and supporters from various countries in Southeast Asia, or even from the world, will visit Indonesia to witness the games. After the games, they could also become international tourists who at another time to come would return to Indonesia. Therefore, the minister said her office was determined to make use of the 26th Southeast Asian Games in the two places of Jakarta and Palembang as one of the country's means of tourism promotion. The provincial administrations of Jakarta and South Sumatra will offer several tourism packages for the athletes namely the Palembang city tour and four Jakarta tourism packages. In Palembang, some of the tourism events which enliven the SEA Games are among others the Sriwijaya International Expo, Arts & Culture and Film Week 2011. Besides, the events could also promote South Sumatra's traditional 'songket' dresses. "There are many ways of promoting cultures such as making use of the current SEA Games to promote the Palembang songket," Tourism and Creative Economic Minister Mari Elka Pangestu said when she visited the songket production center in Tanggabuntung area, South Sumatra, on Saturday. The minister asked 'songket' dress producers to make use of the on-going SEA Games as a means of promoting Palembang's cultures such as its 'songket' dresses. She cited Palembang as an example where noted producers of local traditional 'songket' dress, like Zainal Songket and Fikri Collection in the Tanggabuntu songket production center, were expected to be flooded by orders. "Zainal is convinced his turnover would jump up to 300 percent during the SEA Games while Fikri predicts his business could increase 75 percent," Mari said. In the meantime, the Jakarta regional administration, which co-host SEA Games, also offered tourism packages. The tourism packages which will be offered for the athletes are the free-of-charge city tours to the Old Town, the National Monument and the Indonesia in Miniature Park. Apart from that, the athletes will also have opportunities for shopping at famous shopping malls. Therefore, the Jakarta Administration hoped that SEA Games XXVI athletes who came to the Indonesian capital city would enjoy their visits like in line with Jakarta's tourism slogan: "Enjoy Jakarta". "We are having good coordination in order to turn Jakarta as a friendly host which serves hospitality, provides security while the people and government give their best services. We hope that the SEA Games athletes would enjoy their visits in Jakarta," Sukesti Martono, assistant to the Jakarta governor for cultural and tourism affairs said. Sukesti said the SEA Games would boost the tourism activities, including the business activities of hotels, culinary businesses and recreation centers in Jakarta. "This is a chance for Jakarta to serve delegations from the ASEAN countries, not only their athletes but also their officials and supporters. This is a good chance to increase economic activities," Sukesti said. The SEA Games is participated in by thousands of athletes from 11 countries, namely Brunei Darussalam, Cambodia, Malaysia, Myanmar, Laos, Singapore, Thailand, the Philippines, Timor Leste, Vietnam and Indonesia as the host. Indonesia has several times hosted the Sea Games, namely the 10th Sea Games in 1979, the 15th Sea Games in 1987 and the 19th Sea Games in 1997. ***5*** |
Kamis, 03 November 2011
RAINY SEASON LIKELY TO AFFECT GOVT'S SALT OUTPUT TARGET
| By Andi Abdussalam |
Jakarta, Nov 3 (ANTARA) - The arrival of the rainy season can disturb the country's salt production and prevent the government from achieving its target to produce some 1.4 million tons of salt this year. Though the government is still optimistic, salt farmers have expressed pessimism about the possibility of achieving the target. "The target is difficult to achieve because up to October this year production has only reached about 55 percent," Chairman the Iodized Salt Producers Association (Aprogakob) Slamet Untung Irredenta said here on Thursday. He said that several salt production centers in West Java and Central Java had begun to stop production in line with the arrival of the rainy season. "It is predicted that until the end of the harvest period in mid December 2011 additional production would, at the most, be only 30 percent of the target," he said. Slamet who is also president director of PT Garam (salt) predicted that salt production throughout Indonesia was only about 1.1 - 1.2 million tons until the end of the harvest seasons in 2011. "West Java has stopped production. Some producers in Central Java have also followed suit while production in East Java has begun to be disturbed by cloudy conditions," he said. However, the ministry of maritime affairs and fisheries is still optimistic with the target, which it said was achievable. Director General of Marine Resources, Coastal Areas and Small Islands of the Ministry of Maritime Affairs and Fisheries Sudirman Saad said up to November 1, people's salt production in 40 districts /salt producing cities in 10 provinces has reached 881,603 tons. "This has accounted for more than 60 percent. We are optimistic that up to the end of the harvest seasons, East Java will produce 900,000 tons of salt and West Nusa Tenggara 350,000 tons. It will be added with production from other regions so that the total production would reach 1.4 million tons," Sudirman said. The government is implementing a salt self-efficiency program in the 40 districts in 10 provinces in Indonesia. Under the program, the government is intensifying salt production on a total area of 4,365 hectares belonging to farmers and increase salt production from 60 tons to 80 tons per day. Data at the ministry of maritime affairs and fisheries indicated that the national need for salt in 2011 is set at 2.9 million tons, consisting of 1.l million tons of consumption salt and 1.8 million tons of industrial salt. Fadel Muhammad when he was still maritime and fisheries minister recently said actually Indonesia's total need for salt reached 3.4 million tons this year. The country's total need for salt was formulated by related ministries. The four related ministries have agreed to set the national need for salt at 3.4 million tons, consisting of 1.6 million tons for consumption and 1.8 tons for industry. "The need for 3.4 million tons of salt was agreed by four ministries, namely the trade ministry, the industry ministry, the maritime and fisheries ministry (KKP) and the office of coordinating minister for economic affairs," Fadel Muhammad said. This data is almost the same as that available at the ministry of industry where the national need for salt in 2011 is set at 3.15 million tons which consist of 1.38 million tons of salt for consumption and 1.77 million tons of salt for industry. Up to now, almost all salt for industry need still has to be imported because domestic production is not yet able to meet it. Some of the salt for consumption is also still imported from other countries because the production of salt farming which according to the ministry of industry covered an area of 25,064 hectares is fluctuating in accordance with the climate conditions. Data at the Central Board of Statistics (BPS) showed that salt import in the January - September 2011 period totaled 2.33 million tons worth US$122.52 million. Salt is mainly imported from Australia, India, Singapore, Germany and New Zealand. Fadel Muhammad when he still led the maritime and fisheries ministry decided to stop importing salt for consumption. Salt that will be imported is only that for industry. Because production at home is only about 1.4 million while the need for consumption is 1.6 million tons, the remaining 200 thousand tons could be imported. Under Fadel's leadership, the ministry of maritime and fisheries affairs was tough on its stand to boost salt production at home and opposed salt importation. "It is okey to import salt if it is for industrial need and our production is still unable to meet the required standards. But import must be in a limited volume," Fadel said recently. Fadel's successor, newly named Minister for Maritime Affairs and Fisheries Sharif Cicip Sutardjo, will resume Fadel's program, particularly the salt-sufficiency program in the 10 provinces. For this purpose, the maritime affairs and fisheries ministry has allocated funds totaling Rp90 billion to support the program. Supporting the program is one of the ministry's efforts to increase the domestic salt making industry's ability to meet the domestic need for salt. ***5*** |
Rabu, 02 November 2011
LAW MINISTER TO DECIDE ELIGIBLE PARTY FOR NEWMONT STAKE
| By Andi Abdussalam |
Jakarta, Nov 2 (ANTARA) - The 'dispute' between the finance minister and the House about the party most eligible to purchase shares to be divested by PT Newmont Nusa Tenggara (NNT) is expected to be solved after the law and human rights minister issues a legal opinion. "We will wait for the legal opinion of the ministry of law and human rights," Energy and Mineral Resources Minister Jero Wacik said here on Wednesday after he had decided to leave the issue to the Law and Human Rights Ministry. The local government of West Nusa Tenggara (NTB) has been struggling for the right to purchase seven percent of PT NNT shares in the last phase of a mandatory divestment process although Finance Minister Agus Martowardojo wanted the government to buy the stock through the Government Investment Center (PIP). Earlier, the House of Representatives (DPR)'s Commission XI on financial affairs said it would summon the finance minister about the government's decision to purchase the seven percent stake in NNT. "The finance minister will be summoned as soon as possible to cancel the government's plan to purchase the NNT divestment shares," said Commission XI Deputy Chairman Harry Azhar Azis. A mining observer even suggested that the government cease its efforts to acquire the NNT stake and sit together with all parties involved to discuss the problem. "I think all parties involved should sit together to discuss the problem and try to reach a new agreement," Khomaidi, a mining observer, who is also deputy director of the Reforminer Institute, said. The parties involved are the government, NNT, the Government Investment Center (PIP), the finance ministry, the House of Representatives (DPR), and the State Audit Board (BPK) which audited the process the government had initiated to buy MNT shares. The State Audit Board (BPK) in its opinion said the acquisition process the government had begun called for the use of funds from the state budget. "The BPK said in its opinion that its audit had shown there was the potential of violations in the government's plan to fpurchase the MNT shares. So, we will soon summon the minister," Harry said. He said that there were two points in the opinion of the state audit board that had needed to be heeded by the government. "BPK said an investment by the government using state money needs to be covered by a special government regulation. The same applies to the provision of state participation funds to state-owned enterprises which also needs a special government regulation," he said. The second thing, he said, is that the government needs approval from the House if it wants to make the investment. "The House must approve it in the first place because the funds to purchase the MNT stake would come from the state budget. So far, the finance minister has never asked for the House's approval," he said. In order to get another legal opinion, Minister Wacik left the matter to the law minister. He said the ministry of law and human rights was now studying the legal aspects of the process to divest the 7-percent stake in NNT. The House of Representatives had asked the ministry of energy and mineral resources to give a chance to the West Nusatenggara (NTB) region to obtain the NNT stake, even if Finance Minister Agus Martowardojo had said the government would acquire it through the PIP. Wacik said he had just received a letter from House Commission VII on energy affairs asking the minister to give the seven percent stake to the region (regional government). "So, we will look into it which one is legally correct, whether it is the central government or the regional administration that has the right to purchase the stake," Wacik said. The government's decision to acquire the seven percent stake in PT NNT which operates the Batu Hijau mine, Indonesia's second-largest copper and gold mine in West Nusa Tenggara, has since the beginning been opposed by the local people. Last April, thousands of West Sumbawa district civil servants and other locals took to the streets and blocked roads to the mining location in protest against the central government's plan to buy the shares. They demanded that the seven percent stake be offered to the government of West Sumbawa distict, West Nusa Tenggara province. The law in Indonesia requires foreign companies in the mining sector to transfer 51 percent of their shares to the government or local companies after five years of commercial operation. Thus, NNT had the obligation to divest 51 percent of its stake but because PT Pukuafu Indah, a local company owned a 20-percent stake in NTT, the company was only required to gradually sell a total of 31 percent of its stake to the government or local parties. However, both the government and NNT were then involved in a dispute on how to implement the divestment scheme. The international arbitration court ruled in favor of the Indonesian government, where NNT had to divest three percent of its shares for 2006 and seven percent stake for each year from 2007 through 2010. Up to 2009, 24 percent of the divestment process had been carried out, leaving another seven percent in the last phase for 2010, which until now the central government and local administration are fighting to acquire.***5*** |
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