Illicit tin miners send market into a spin
Friday, October 26 2001 - 03:54 PM WIB
PT Timah told an industry meeting in London that appeals to the Jakarta authorities to put a halt to the operations had fallen on deaf ears.
The price of tin has plunged on world markets from ?3,500 per tonne to below ?2,590 amid reports of illegal output in south-east Asia.
Industry suspicions were confirmed by PT Timah officials who were in Britain for London Metals Exchange week. They estimate that Bangka island's unlicensed miners could be producing nearly one third of all new tin flooding on to the market.
Anthony Turner, who represents the world's second largest tin mining group Minsur of Peru, said: "Major producers are deeply concerned about these illegal activities which are causing extreme environmental damage while having a severely depressing effect on tin prices." Paul Atherley, managing director of another precious metals group, Murchison United, said: "We operate at the Renason Bell tin mine in Tasmania to the highest standards of environmental care and health and safety. Actions in Indonesia are making it very hard to reinvest for the future."
The industry believes that problems on Bangka stem from the devolution of power from Jakarta to the regions and regulations imposed by central government being ignored by local authorities.
The country has been racked by civil disturbances and breach of law since the collapse of the economy four years ago and the end of General Suharto's dictatorial regime.
The 300-mile arc of islands that make up Indonesia produce nearly half of all the world's tin, 65% of the copra and 23% of chromium ore.
Miners such as Rio Tinto have been trying to improve their image by taking more interest in environmental issues. But they remain a target of green campaigners who will question whether the real concern about Indonesia stems from loss of profits. (*)