Govt may ease mandatory divestment

The government may revise the regulation No.24/2012 on the mandatory divestment requirement imposed on foreign mineral and coal mining companies as such that only those involved in upstream operations would be required to divest part of their shares to local investors, Bisnis Indonesia reported on Monday.

Director general of mineral and coal at the Energy and Mineral Resources Ministry, Thamrin Sihite, said in Jakarta last week that the mining companies which are only involved in downstream operations would not be required to carry out divestment.

He, however, said the revision of the regulation would be discussed first with other related ministries such as the Ministry of Industry, which directly oversees mineral smelting operations in the country.

According to Thamrin, with regard to companies which are involved in both upstream and downstream operations, there may need to be a different regulation. The requirement could be eased if the smelting plants are located in the eastern part of Indonesia, with large investment, he added. (*)