1) SBY to address Papua issues in
Fiji
2) Indonesia and
Fiji to push relationship
3) For Both Indonesia and Freeport, It’s About Time to Face
the Facts
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1) SBY to address Papua issues in Fiji
The Jakarta Post, Jakarta | National | Wed, June 18 2014, 9:36 AM
President Susilo Bambang Yudhoyono said he would explain his policies on Papua during his visit to Fiji, where he will attend a meeting of Pacific Island leaders, some of whom have been critical of Jakarta’s handling of Papua.
Yudhoyono left Jakarta on Tuesday morning for a three-day state visit to Fiji at the invitation of the country, in order to boost bilateral ties. During the visit to the Pacific Islands, the first made by an Indonesian president since the country’s independence, Yudhoyono will meet with Fiji President Ratu Epeli Nailatikau and will have a bilateral meeting with Prime Minister Frank Bainimarama.
However, Yudhoyono said the real significance of the visit related to the second summit of the Pacific Islands Development Forum (PIDF) in Nadi, where he is expected to give a “major policy speech” on Thursday at the invitation of the forum.
Other than to improve the “sincere” friendship and cooperation with South Pacific countries, Yudhoyono added the forum was “a good opportunity for Indonesia to be able to explain the policy regarding Papua” in order to “reduce misinformation or disinformation”.
“Therefore, we hope the matters on Papua, which are often internationalized by certain elements, can be overcome by, among other things, establishing strong and good ties with the countries of the South Pacific,” Yudhoyono said during a press conference on Tuesday morning at Halim Perdanakusuma Airport.
He later cited two organizations that he deemed as often being used by the Free Papua Movement (OPM) to get international support: the Melanesian Spearhead Group (MSG) and the Pacific Islands Forum.
In mid-January, however, MSG member nations, which have often voiced concern over alleged human rights abuses in Papua, asserted during their visit to Jakarta that they fully respected Indonesia’s sovereignty. At that time, MSG member nations and Indonesia said in a joint statement that they “supported respective sovereignty, unity and territorial integrity and the principle of non-interference in each other’s internal affairs, consistent with the Charter of the United Nations.”
The statement was made as the West Papua National Coalition for Liberation (WPNCL), a separatist group, applied for MSG membership. The group is known to support the area’s independence from Indonesia and sees membership in the MSG as a step toward international recognition. Human rights watchdogs have often criticized Indonesia for state violence against Papuans.
However, the MSG member nations’ meeting with Yudhoyono in Jakarta was carried out without the presence of a representative from Vanuatu. Several foreign media outlets reported at the time that Vanuatu’s absence was due to the country’s belief that the delegation would not have the opportunity to meet civil society groups in West Papua during the visit.
Vanuatu, which harbors several high-ranking OPM officials, also internationalized the Papuan human rights issue by discussing it at the UN General Assembly last September.
On Tuesday, Yudhoyono said that the MSG representatives had indeed “witnessed the situation in Papua, as well the Indonesian policies on justice, economic development and security” in the area.
He was referring to an occasion between Jan. 11 and 16 where Indonesia invited the MSG officials to Papua and Jakarta to receive briefings on development in Papua, in a move that was seen by some as a way of obtaining international support for the country’s sovereignty following the WPNCL bid.
In June last year, an MSG summit meeting deferred the WPNCL bid by at least six months, saying it was important to engage with Indonesia.
The MSG agreed to establish a consultation with Indonesia and welcomed the invitation to visit the country, although the group also concluded that it fully supported the right of the people of West Papua to self-determination, and cited concerns about human rights violations.
Yudhoyono also emphasized that relations between Indonesia and four key actors in the region — Timor Leste, PNG, Australia and New Zealand — have been strong over the past 10 years, as the countries formally respect Indonesia’s sovereignty.
In terms of the bilateral meeting with Fiji, presidential spokesman for international affairs Teuku Faizasyah said that discussions would cover efforts to further strengthen ties, particularly in terms of cooperation on maritime affairs, culture, democracy and good governance.
The two countries are also set to sign several memorandums of understanding, including on diplomatic training, as well as youth and sports cooperation.
“This visit completes the sustainability efforts of Indonesia to build partnerships with the island states in the Pacific region, which began during the administration of former president Abdurrahman Wahid through the Southwest Pacific Dialogue,” Teuku said previously.
Yudhoyono left Jakarta on Tuesday morning for a three-day state visit to Fiji at the invitation of the country, in order to boost bilateral ties. During the visit to the Pacific Islands, the first made by an Indonesian president since the country’s independence, Yudhoyono will meet with Fiji President Ratu Epeli Nailatikau and will have a bilateral meeting with Prime Minister Frank Bainimarama.
However, Yudhoyono said the real significance of the visit related to the second summit of the Pacific Islands Development Forum (PIDF) in Nadi, where he is expected to give a “major policy speech” on Thursday at the invitation of the forum.
Other than to improve the “sincere” friendship and cooperation with South Pacific countries, Yudhoyono added the forum was “a good opportunity for Indonesia to be able to explain the policy regarding Papua” in order to “reduce misinformation or disinformation”.
“Therefore, we hope the matters on Papua, which are often internationalized by certain elements, can be overcome by, among other things, establishing strong and good ties with the countries of the South Pacific,” Yudhoyono said during a press conference on Tuesday morning at Halim Perdanakusuma Airport.
He later cited two organizations that he deemed as often being used by the Free Papua Movement (OPM) to get international support: the Melanesian Spearhead Group (MSG) and the Pacific Islands Forum.
In mid-January, however, MSG member nations, which have often voiced concern over alleged human rights abuses in Papua, asserted during their visit to Jakarta that they fully respected Indonesia’s sovereignty. At that time, MSG member nations and Indonesia said in a joint statement that they “supported respective sovereignty, unity and territorial integrity and the principle of non-interference in each other’s internal affairs, consistent with the Charter of the United Nations.”
The statement was made as the West Papua National Coalition for Liberation (WPNCL), a separatist group, applied for MSG membership. The group is known to support the area’s independence from Indonesia and sees membership in the MSG as a step toward international recognition. Human rights watchdogs have often criticized Indonesia for state violence against Papuans.
However, the MSG member nations’ meeting with Yudhoyono in Jakarta was carried out without the presence of a representative from Vanuatu. Several foreign media outlets reported at the time that Vanuatu’s absence was due to the country’s belief that the delegation would not have the opportunity to meet civil society groups in West Papua during the visit.
Vanuatu, which harbors several high-ranking OPM officials, also internationalized the Papuan human rights issue by discussing it at the UN General Assembly last September.
On Tuesday, Yudhoyono said that the MSG representatives had indeed “witnessed the situation in Papua, as well the Indonesian policies on justice, economic development and security” in the area.
He was referring to an occasion between Jan. 11 and 16 where Indonesia invited the MSG officials to Papua and Jakarta to receive briefings on development in Papua, in a move that was seen by some as a way of obtaining international support for the country’s sovereignty following the WPNCL bid.
In June last year, an MSG summit meeting deferred the WPNCL bid by at least six months, saying it was important to engage with Indonesia.
The MSG agreed to establish a consultation with Indonesia and welcomed the invitation to visit the country, although the group also concluded that it fully supported the right of the people of West Papua to self-determination, and cited concerns about human rights violations.
Yudhoyono also emphasized that relations between Indonesia and four key actors in the region — Timor Leste, PNG, Australia and New Zealand — have been strong over the past 10 years, as the countries formally respect Indonesia’s sovereignty.
In terms of the bilateral meeting with Fiji, presidential spokesman for international affairs Teuku Faizasyah said that discussions would cover efforts to further strengthen ties, particularly in terms of cooperation on maritime affairs, culture, democracy and good governance.
The two countries are also set to sign several memorandums of understanding, including on diplomatic training, as well as youth and sports cooperation.
“This visit completes the sustainability efforts of Indonesia to build partnerships with the island states in the Pacific region, which began during the administration of former president Abdurrahman Wahid through the Southwest Pacific Dialogue,” Teuku said previously.
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2) Indonesia and Fiji to push relationship
Updated at 6:34 pm today
An expert on Melanesia says the Indonesian president's presence at the Pacific Islands Development Forum demonstrates both countries' push to develop international relationships.
The president, Susilo Bambang Yudhoyono, arrived in Fiji last night for the second summit of the Forum.
The Lowy Institute's Melanesia programme director, Jenny Hayward-Jones, says it is very important for Fiji to be hosting someone as important as President Yudhoyono.
She says the Indonesian government wants to send a message that it values its relationship with Melanesian countries.
But she says the West Papua issue is unlikely to be discussed.
I think probably you'll see avoidance of the West Papua issue if anything. But I think what you'll see is the Indonesian president talk about the importance of more economic ties, more trade and investment, certainly there's opportunities for that, more educational ties between Indonesia and the region and probably offering to help Pacific Island countries interact more with Asian countries.
The Lowy Institute's Jenny Hayward-Jones
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3) For Both Indonesia and Freeport, It’s About Time to Face the Facts
Perhaps unbeknown to many, the chief executives of both Freeport McMoRan Copper & Gold and Newmont Mining have been jetting in and out of Jakarta recently to conduct high-level talks with the new coordinating minister for the economy, Chairul Tanjung. While the local media speculates on whether Richard Adkerson, CEO of Freeport, has been lobbying the minister to have its contract renewed beyond 2021, the talks primarily dealt with the resumption of Indonesia’s exports of copper concentrates, which stalled after the new mining regulation came into effect in January.
The new regulation, which requires foreign mining companies to build smelters, is part of the government’s patriotic push to maximize revenues from the mining sector. The nationalistic bend is likely to be picked up by the new government after the July presidential election as both candidates for the country’s top job seem eager to be seen as putting national interests above those of foreign companies.
The biggest foreign stakeholder in Indonesia’s mining sector is without a doubt Freeport Indonesia which is the operator of the world’s largest gold mine and third largest copper mine at Grasberg in the province of Papua. The US company’s 40-odd-year operation has indeed become a polemic among Indonesians, many of whom see the company as a symbol of foreign exploitation of the country’s natural resources, leaving behind an environmental time bomb in its wake.
But to be fair, Freeport also sustains 30,000 odd jobs for Indonesians, is the country’s single biggest taxpayer and spent $39.4 million in 2012 on community development projects for the benefit of the local Papuans. Indeed the company has long pledged 1 percent of its profits on community development in the province. Nonetheless, questions are being asked whether a mere 1 percent is any longer sufficient considering the environmental damage to the land as a result of the company’s mining operation.
The 1977 dynamite attack on Freeport’s facilities by local separatists, along with more recent attacks, clearly indicate that many Papuans see the company’s existence as more injurious than beneficial to them. Resentment towards the company is reportedly rife among the Free Papua Movement supporters who believe that Freeport is enriching the central government of Indonesia at the expense of the Papuans.
This view becomes particularly persuasive when one considers that the thirty-odd million dollars spent on local projects as part of the company’s corporate social responsibility programs are trifles compared to the nearly 4 billion annual net profits booked by the company.
Freeport’s position in the country is further complicated by Jakarta’s desire to quell Papuan separatism with further concessions that may appease the locals. Consequently, the next government may channel more funds to help develop the province, and as such Freeport will be expected to contribute its share.
It might be wise for Freeport to increase its CSR pledge for local development significantly in a bid to strengthen local support for the company. A generous voluntary pledge of its net profits to benefit the Papuans could clearly be a valuable bargaining chip for Freeport when it renegotiates with Jakarta for extension of its operation in 2019.
A strong pro-Indonesian image is definitely needed by the company as the next government will clearly be under public pressure to strike a patriotic pose at the 2019 negotiation, especially in an election year. It is essential that Freeport is seen doing more things that benefit Papua particularly and Indonesia generally before then.
As a company Freeport Indonesia currently pays 25 percent on its income, admittedly a higher rate than most companies pay in the country. Under the current contract, the Indonesian government has 9.36 percent of the company’s shares, a figure that a nationalistic future government may want to increase.
However, the figure of 51 percent of shares for the country that has been proposed is also unrealistic at best. Although its Indonesian operation accounts for 20 percent of its revenues globally, it is difficult to see Freeport cede the majority of its shares to the Indonesian government.
The crunch of the matter is the need for realism for both the government and the mining companies. The relatively new player Newmont, for example, has protested against the new regulation that requires the construction of local smelters by temporarily ceasing its mining operation, putting thousands of local jobs in jeopardy.
As the Indonesian government embraces more public transparency, multinational mining operators must realize that a more nationalistic mining policy is inevitable. The issue has become a crucial point with the Indonesian constituency as a benchmark for the government’s defense of national interests and sovereignty. At the same time, the country still needs foreign expertise and capital to pry out most of its natural resources. Hence, for better or worse, a compromise must be worked out, one that satisfies the Indonesian public and is acceptable to investors.
Johannes Nugroho is a writer and businessman from Surabaya.
The new regulation, which requires foreign mining companies to build smelters, is part of the government’s patriotic push to maximize revenues from the mining sector. The nationalistic bend is likely to be picked up by the new government after the July presidential election as both candidates for the country’s top job seem eager to be seen as putting national interests above those of foreign companies.
The biggest foreign stakeholder in Indonesia’s mining sector is without a doubt Freeport Indonesia which is the operator of the world’s largest gold mine and third largest copper mine at Grasberg in the province of Papua. The US company’s 40-odd-year operation has indeed become a polemic among Indonesians, many of whom see the company as a symbol of foreign exploitation of the country’s natural resources, leaving behind an environmental time bomb in its wake.
But to be fair, Freeport also sustains 30,000 odd jobs for Indonesians, is the country’s single biggest taxpayer and spent $39.4 million in 2012 on community development projects for the benefit of the local Papuans. Indeed the company has long pledged 1 percent of its profits on community development in the province. Nonetheless, questions are being asked whether a mere 1 percent is any longer sufficient considering the environmental damage to the land as a result of the company’s mining operation.
The 1977 dynamite attack on Freeport’s facilities by local separatists, along with more recent attacks, clearly indicate that many Papuans see the company’s existence as more injurious than beneficial to them. Resentment towards the company is reportedly rife among the Free Papua Movement supporters who believe that Freeport is enriching the central government of Indonesia at the expense of the Papuans.
This view becomes particularly persuasive when one considers that the thirty-odd million dollars spent on local projects as part of the company’s corporate social responsibility programs are trifles compared to the nearly 4 billion annual net profits booked by the company.
Freeport’s position in the country is further complicated by Jakarta’s desire to quell Papuan separatism with further concessions that may appease the locals. Consequently, the next government may channel more funds to help develop the province, and as such Freeport will be expected to contribute its share.
It might be wise for Freeport to increase its CSR pledge for local development significantly in a bid to strengthen local support for the company. A generous voluntary pledge of its net profits to benefit the Papuans could clearly be a valuable bargaining chip for Freeport when it renegotiates with Jakarta for extension of its operation in 2019.
A strong pro-Indonesian image is definitely needed by the company as the next government will clearly be under public pressure to strike a patriotic pose at the 2019 negotiation, especially in an election year. It is essential that Freeport is seen doing more things that benefit Papua particularly and Indonesia generally before then.
As a company Freeport Indonesia currently pays 25 percent on its income, admittedly a higher rate than most companies pay in the country. Under the current contract, the Indonesian government has 9.36 percent of the company’s shares, a figure that a nationalistic future government may want to increase.
However, the figure of 51 percent of shares for the country that has been proposed is also unrealistic at best. Although its Indonesian operation accounts for 20 percent of its revenues globally, it is difficult to see Freeport cede the majority of its shares to the Indonesian government.
The crunch of the matter is the need for realism for both the government and the mining companies. The relatively new player Newmont, for example, has protested against the new regulation that requires the construction of local smelters by temporarily ceasing its mining operation, putting thousands of local jobs in jeopardy.
As the Indonesian government embraces more public transparency, multinational mining operators must realize that a more nationalistic mining policy is inevitable. The issue has become a crucial point with the Indonesian constituency as a benchmark for the government’s defense of national interests and sovereignty. At the same time, the country still needs foreign expertise and capital to pry out most of its natural resources. Hence, for better or worse, a compromise must be worked out, one that satisfies the Indonesian public and is acceptable to investors.
Johannes Nugroho is a writer and businessman from Surabaya.
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