No need to honor mining contracts filled with corruption
Attack on Freeport intensifies
Thursday, March 2 2000 - 04:30 AM WIB
Mining contracts made through corrupt, nepotism, and collusive practices like the contract of work of gold mining giant PT Freeport Indonesia should not be honored, according to noted economist Rizal Ramli.
Speaking in a press conference, Rizal said that only clean contracts that should be honored by all parties.
He was responding to warning from former U.S. foreign affairs minister Henry Kissinger that Indonesia must honor its contract with Freeport to maintain foreign investors confidence in the country.
"But I believe that Kissinger only represents Freeport. I'm sure that the public and the politicians in the U.S. don't support any corrupt and collusive practices launched by a U.S. firm in a developing country," Rizal said.
He also doubted the warning of Kissinger that foreign investors would run away from Indonesia if it revise Freeport mining contract.
"They will not run away. Indonesia is too attractive."
Freeport won its mining contract during the 1960s when the former authoritarian rule president Soeharto just started his administration. Many believe that Freeport had been able to maintain its contract during the 32-year rule of Soeharto through corrupt and collusive practices.
Freeport has also been alleged of destroying the environment, human rights violation, and neglecting the local people. Minister of Environment Sonny Keraf is leading the an attack on Freeport's poor environmental management.
There's now increasing pressure to revise Freeport contract or even terminate the contract if the company is proven to have violated the law or ruin the environment.
Freeport public relations officer Yuli Ismartono said that the Attorney General Office had conducted an investigation and found no prove of corrupt practices in Freeport.
Meanwhile, Kompas quoted former Freeport employee as saying that the allegation that the company polluted the environment in Irian Jaya was true, pointing out that its tailing waste product had destroyed the local mangrove forest.
The source who claimed for anonymity also said that the recent audit made by Montgomery was a mere cover up.
He also said that Freeport had evicted people of one village from its mining site territory during the Soeharto rule through the help of the military.
Separately, top executive of the Indonesian Environmental Forum (Walhi) Emmy Hafidl als lambasted the comments made by Kissinger. Emmy said that Indonesia has every rights to revise the contract of Freeport because the country must protect its environment.
Emmy added that the contract of Freeport was made during the rule of Soeharto without the participation of the Indonesian people.
Emmy warned Kissinger to honor the process of democracy in Indonesia.
She urged President Abdurrahman Wahid to revise Freeport contract and terminate it if necessary.(*)