Mining Sector is Sluggish

The amendment to the regulation of raw minerals export ban enacted since January 2014 now affecting the mining investment and regulation consistency in Indonesia.

Frazer Institute had once been giving Indonesia mining investment weather in 2013 the worst level. The reason is as the same with the current situation include bureaucracy, legal uncertainty, security threats, political stability, and the environment policy.

At that time, some respondents disappointed with the incapability of Indonesia to minimising the risks of the amendment regulation over the investment. Even though, Indonesia holds the biggest three of mineral resources potential. But negative perception dropped down the grade to 99 of 109 the worst state for investment weather.

The Mining legal expert from Hasanuddin University Prof. Abrar Saleng said the abundant mineral resources should benefit and gives value added through refining and processing.

The refining and processing now are advanced as the smelter completely built. The amendment of law and regulation should be positively considered as an effort to put Indonesia in the top of the greatest coal mining industry in the world.

“Unfortunately, the government seems does not ready yet and is inconsistent with the mining regulation stipulation. At the same time, mining industry and investment are needing legal certainty and consistency from the government as the regulator and the protector. The government once opened the opportunity to export which is the opposite measure over the preceding regulation,” he said.

The Coordinator of Civilian Coalition for Constitution Justice Ahmad Redi said it has reported the maladministration allegation related to the mining and raw mineral were allowed to be exported.

The coalition hopes that would be a comprehensive auditing associated with motivation, goal, and losses expected to emerge led by the amendment of regulation opposites with the mining Act.

The member of Commission VII House of Representatives Satya W Yudha said exporting low-level minerals could affecting the sustainability of nickel supply in the domestic smelter.

Besides the regulation, the government also necessary to see the smelter development as the impact of low-level mineral export relaxation. “The relaxation assumed to strengthen export monitoring because the regulation is potential does not follow the requirements such as to build the smelter and pay export duty,” he said.

Based on research issued by the LPEM UI, last year, it said that the ban of raw mineral export triggered the positive impact include the reduction of illegal mining activity, the improvement of processing industry in the sector, the improvement of economy growth, and the lower environment degradation.

The ban of raw mineral and bauxite export intended to benefits the national economy as maximum as possible.

The benefits felt, even it is not maximum. The regulation provided the macro economy growth with a positive impact and its implementation to reduce illegal mining activity, environment destruction, and the multiplier effect of smelter development.

The research also reported the degradation of environment risks and the illegal export due to the relaxation would lead to the massive exploitation of raw mineral without considering the carrying capacity of land and ecosystem, and the illegal stacks of mineral to the export destination. (Dds/Pas)


Source: Rakyat Merdeka

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