Investment in mining sector remains low

The flow of new investment in the country's mining sector remains low and this condition will likely continue until the end of this year, Director General of Geology and Mineral Resources Simon F. Sembiring said as reported by Investor Daily on Saturday.

Speaking at a seminar on the investment in mining sector in Jakarta on Thursday, Sembiring said that both local and foreign companies were still reluctant to invest in the mining sector because the continued uncertainty in the legal aspect of mining operation in Indonesia.

"There have been no new investments at all since last year. The investments are only made by existing mining companies, mostly for the replacement of their mining equipment," he said.

He added that the new investment for exploration has dropped drastically during recent years. "Investors remain reluctant to put new investment because they feel the government has no strong commitment to remove the legal uncertainty in the mining sector," he added.

He cited that the government's legal action against Newmont Minahasa Raya in North Sulwesi had seriously damaged the investment climate. "The Buyat case has scared away investors," he added.

The office of the state minister of environment filed lawsuit against PT Newmont Minahasa Raya (NMR) at the South Jakarta district court for polluting the sea water around its submarine mining waste disposal in the province's Buyat bay. (*)