Associations oppose plan to limiting foreign investment in mining exploration

Mining industry associations oppose government?s plan to limit foreign investors ownership in exploration projects to 75 percent as it would discourage badly needed investment in the sector, Bisnis Indonesia reported on Monday.

Executive Director of the Indonesian Mineral Enterpreneurs Association (Apemindo) Ladjiman Manik was quoted as saying that mining exploration projects require huge investment, and as such it would be difficult to realize the project if foreign ownership is limited.

?If (foreign) ownership is limited to 75 percent, will they be interested? Please review again the planned policy (to limit foreign ownership) wisely,? he said.

Chairman of the Investment Coordinating Board (BKPM) Franky Sibarani said last week he plans to hold a meeting soon with related ministers to regulate the mining exploration sector including by limiting foreign ownership to 75 percent in a bid to push domestic investors to play greater role in exploration projects.

Executive Director of the Indonesian Coal Mining Association (APBI), Hendra Sinadia supported Ladjiman?s opinion, saying that most exploration projects in the country are conducted by foreign investors as it require huge investment and are highly risky. ?The policy (to limit foreign ownership in exploration projects) will hampere exploration activities which are vital to the sustainability of the mining and coal sector,? he said.

Meanwhile, Director for Centre of Indonesian Resources Studies (Ciruss), Budi Santoso supported the planned policy as it would encourage domestic investors to parciticipate in exploration projects, not merely as ?partner on paper.? (*)