Government must be tough to protect mining investors: Analysts

The government needs to take tough actions against people who cause troubles on mining investors in order to maintain a conducive investment climate in the industry, analysts said as quoted by Kompas in its Tuesday edition.

?The incident in Freeport which was followed by the burning of Newmont?s camps in Nusa Tenggara indicate that security problem is still the main issue potentially hampering mining activities,? Darrel Johnson, a member of the American Chamber of Commerce in Jakarta, said during the seminar on Investment in Indonesia in Bali on Monday.

He said if the security problem happened because the local communities were dissatisfied over the community development programs carried out by the mining investors, the contract of works held by the investors and other agreements had set a clear guideline on how to solve the problem.

He said the government needed to take tough actions to prevent disturbances from recurring in mining sites.

Another thing that dampens the interest of investors to invest in Indonesia is the Coal and Mineral Bill which is being discussed at the House of Representatives. The bill give the authority to the local government to issue licenses for mining investors.

?In fact, contract of work has become a standard contract which is not only applied in Indonesia, but also other countries,? Johnson said.

Roger Suyama, head of Merril Lynch?s Indonesian Representative Office, said mining investors needed certainty.

?They don?t want their contracts change after several years due to the change in the governmental regulations,? he said. (*)