Saturday, February 18, 2017

1) CEO resigns after force majeure on copper

1) CEO resigns after force majeure on copper 
2) Freeport Indonesia chief resigns as dispute over mining policy intensifies
3) 5.1-Magnitude Quake Hits Jayapura

1) CEO resigns after force majeure on copper 
Posted 18 Feb 2017 23:00

JAKARTA: Chappy Hakim, chief executive of miner Freeport-McMoran Inc's Indonesian unit, has resigned, the company said on Saturday, after the parent firm declared force majeure on copper concentrate shipments from its Grasberg mine in Papua.
Freeport, which has been negotiating with the Indonesian government after halting exports due to new mining rules, said on Friday it could not meet contractual obligations for copper concentrate shipments from the giant mine following a five-week export stoppage.

JAKARTA: Chappy Hakim, chief executive of miner Freeport-McMoran Inc's Indonesian unit, has resigned, the company said on Saturday, after the parent firm declared force majeure on copper concentrate shipments from its Grasberg mine in Papua.
Freeport, which has been negotiating with the Indonesian government after halting exports due to new mining rules, said on Friday it could not meet contractual obligations for copper concentrate shipments from the giant mine following a five-week export stoppage.
All work has stopped at the mine, the world's second largest for copper, a union leader said. Hakim, a former air force chief, had only been in the job for a few months. Freeport Indonesia hoped he would be able to use his political connections to help the firm navigate its way through a period of regulatory uncertainty.
"I have decided it is in the best interests of PTFI (Freeport Indonesia) and my family to step down from my duties as president director while continuing to support the company in an advisory role," Hakim said in a company statement.
A Freeport Indonesia spokesman said he could not confirm who Hakim's successor would be.
Freeport was the second big copper producer in a week to declare force majeure, after BHP Billiton did so on Feb. 10 for Escondida in Chile, where a strike had grounded the world's largest mine.
Grasberg was expected to produce 800,000 tonnes of copper in 2017, about 3.5 percent of global supply, said Jefferies analyst Chris LaFemina. Coupled with Escondida, the mines represent some 10 percent of global supply, he said.
Under new mining rules that Indonesia introduced in January, Freeport had to switch from the contract of work it had operated under since 1967 to a special mining permit before applying for export permits.
The new permit requires Freeport to pay taxes and royalties it was previously exempt from and divest up to 51 percent of its Indonesian unit, an increase from a previously set 30 percent. To date, it has divested 9.36 percent.
Indonesia's Mining Minister Ignasius Jonan on Saturday said Freeport had refused the government's offer of a six-month transition period in which the company can negotiate terms for its new mining permit.
Freeport could begin exporting again if it agreed to the transition period, Jonan said.
His ministry on Friday recommended that Freeport be allowed to export 1.1 million tonnes of copper concentrates until Feb. 16, 2018.
The recommendation was conditional on Freeport accepting the special permit, said the parent company's spokesman Eric Kinneberg, repeating that the Phoenix, Arizona-based miner would only agree to a permit that provided the same fiscal and legal protection as currently.
Jonan said that bringing the dispute to an arbitrator could hurt the relationship between the company and the government.
"But it would be a much better step rather than always using the issue of firing workers as a tool to pressure the government," Jonan said.
(Reporting by Agustinus Beo Da Costa; Additional reporting by Wilda Asmarini; Writing by Gayatri Suroyo and Susan Taylor; Editing by Ed Davies and John Stonestreet)

2) Freeport Indonesia chief resigns as dispute over mining policy intensifiesJakarta | Sat, February 18, 2017 | 05:16 pm
PT Freeport Indonesia announced on Saturday the immediate resignation of Chappy Hakim as its president director, only three months after his appointment as the mining giant's top executive.
In a press release, Freeport Indonesia did not specify when Chappy, a retired air chief marshal, would officially step down. However, it said he would move to an advisory role with the company.
“Serving as Freeport Indonesia president director involves an extraordinary commitment of time. I have decided it is in the best interests of Freeport Indonesia and my family to step down from my duties as president director while continuing to support the company in an advisory role,” Chappy said as quoted in the release.
Chappy's resignation occurred as the company, a subsidiary of United States-based Freeport-McMoRan, fights against complying with the government’s latest mining policy, which stipulates that miners must convert their current contracts of work (CoWs) into special mining permits (IUPKs) in exchange for permission to continue exporting certain mineral ores and concentrates. 
Freeport has repeatedly said it would not agree to the contract conversion unless the government provided assurance of long-term investment stability, consisting of fiscal and legal certainty, in accordance with its CoW signed in 1991.
Freeport-McMoRan CEO and president Richard C. Adkerson thanked Chappy for his contributions to the company.
“We understand that this was a difficult decision for Pak Chappy to make. We appreciate his service to our company and his support. We look forward to his continued advice and counsel,” he said.
Chappy, also known as an aviation industry expert and prolific writer, was appointed as Freeport Indonesia’s top executive in November. The company previously appointed retired military officer Air Vice Marshall (ret.) Maroef Sjamsoeddin as president director. (hwa


SATURDAY, 18 FEBRUARY, 2017 | 08:54 WIB
3) 5.1-Magnitude Quake Hits Jayapura
TEMPO.COJayapura - An earthquake measuring 5.1 on the Richter scale shook the Papua provincial capital of Jayapura on Friday night, forcing local residents to rush outdoors.
The epicenter of the quake which struck at 08.21 p.m. local time was located 53 km northwest of Jayapura district at a depth of 12 km, chief of the Angkasapura geophysics station Cahyo Nugroho said.
The quake was strongly felt by people living in Jayapura city, Jayapura district, and Keerom district, Nugroho said.
There was no immediate report of casualties or material damage.

Friday, February 17, 2017

1) Freeport declares force majeure on Indonesia mine -spokesman

1) Freeport declares force majeure on Indonesia mine -spokesman

2) Rebel Musik to raise awareness on West Papua struggle


1) Freeport declares force majeure on Indonesia mine -spokesman

Feb 17 Freeport-McMoRan Inc, the world's biggest publicly traded copper miner, has declared force majeure at its Grasberg mine in Indonesia, which cannot meet contractual obligations on copper concentrate shipments, a spokesman told Reuters on Friday
Exports of copper concentrate from the mine have been suspended for more than a month, and last week production at the Papua, Indonesia mine came to a standstill. (Reporting by Susan Taylor; Editing by Chizu Nomiyama)


2) Rebel Musik to raise awareness 

on West Papua struggle

It’s all about using your talent to spread a message, says Richard Mogu, an artist from the Central Province of PNG.

Mogu, is part of the Rebel Musik collaboration taking the stage of XO state in Melbourne, next Friday, February 24.

Rebel Musik, he says, will raise awareness on the struggle of West Papua and other ignored issues.

Put together as an initiative of Aireleke – a musician and recognised activist for West Papua, the group of talented musicians from PNG and West Papua will voice the concern on the musical stage.

 “Music is an art form but should not be taken for the aesthetics of it only – the beauty of art as an organised sound.

“I believe we can use music as a tool to raise awareness and reach a wider and greater audience far more quickly.

“I personally do gospel music but in this case, we are raising the message of the silent majority.

“I look forward to the performance, particularly, what it will stir – will it get people up and dancing? Will it make authorities stop and ask what we’re singing about?” he said.

Mogu will be part of the backing band and will also appear as an artist to perform at least two songs.

“It’s been a while performing overseas so I’m excited for this,” he added.

Mogu leaves today for Melbourne.: LoopVanuatu


1) Government to focus on improving quality of lecturers in Papua

1) Government to focus on improving quality of lecturers in Papua


Timika, Papua (ANTARA News) - The government will prioritize improving the quality of lecturers in Papua through the issuance of a certification of competence.

"The certification is intended to produce graduates having sound knowledge and skills," Research, Technology, and Higher Education Minister Muhammad Nasir stated here on Friday.

The minister remarked that the government will focus on improving the quality of lecturers working in polytechnics and universities.

"The government urges polytechnics to create a qualified workforce through the issuance of a certification of competence," he said.

Vocational colleges should produce qualified human resources in an attempt to meet the industry demand.

The government will assist lecturers in obtaining certification through education and financing.

"In Papua, the government is concentrating on improving the quality of workforce engaged in the tourism and health sectors," he remarked.

The lecturers in polytechnics should clear a competency test in a bid to educate the students on the certification of competence.

"Only six percent of the vocational colleges are in Indonesia. In fact, the country has 4,529 universities that produce more academics," he pointed out.

President Joko Widodo (Jokowi) had earlier called on the Indonesian Chamber of Commerce and Industry (Kadin) to help improve the quality of education offered by vocational schools across the country.

"We need millions of skilled human resources, so Kadin can help to improve the quality of education in vocational schools," President Jokowi said while opening the 2016 Kadin Leadership National Meeting at the Borobudur Hotel.

The president stated that Indonesia will benefit from a demographic bonus after 2020 when the number of people of the productive age will be higher than the number of elderly and children.

The younger generation should continue to build its capacity and capabilities in accordance with any formal and non-formal education they acquire. Only then will Indonesia be able to take advantage of the demographic bonus.

This demographic bonus will help the development of the creative economy in the country.

The greater the number of people of the productive age in Indonesia, the more internet users we will see. This will increase the nations creative ability and help to throw up new ideas to create value-added products of high quality.(*)

Editor: Heru


FRIDAY, 17 FEBRUARY, 2017 | 23:06 WIB
2) Gov't Issues Freeport Export Recommendation  
TEMPO.COJakarta - The Energy and Mineral Resources Ministry issued export recommendation licenses for PT Freeport Indonesia (PT FI) and PT Amman Mineral Nusa Tenggara (PT AMNT).
The export recommendation for Freeport was issued based on a request letter No. 571/OPD/II/2017 delivered by the company on February, 2017. Meanwhile, the export recommendation for PT Amman Mineral Nusa Tenggara was issued on February 17, 2017.
"PT FI and PT AMNT both have declared their commitment to construct smelter," said Sujatmiko, Chief of Communication, Public Relationship and Ministerial Cooperation of the Energy and Mineral Resources Ministry in a written statement dated Friday, February 17, 2017.
The export recommendation was issued in accordance with the Energy and Mineral Resources Regulation No. 6 of 2017 and Trade Minister Regulation No. 1/M-DAG/PER/1/2017.
Sujatmiko added that the government will continue to monitor the progress of the smelter construction once every six months. The export recommendation will be revoked if both companies failed to fulfill their commitment in smelter construction.

3) Mining Ministry Backs Freeport's Copper Concentrate Exports
Jakarta. Indonesia's mining ministry said on Friday (17/02) it has issued a recommendation that is expected to allow the local unit of Freeport McMoRan Inc to resume copper concentrate exports within days.
The announcement comes after a more than one-month stoppage which push global copper prices to 21-month highs this week.
Freeport will be allowed to export 1.1 million tonnes of copper concentrate over the next one year, the mining ministry said in a statement seen by Reuters.
Fri Feb 17, 2017 | 8:04 AM EST
4) Indonesia gives Freeport green light to resume copper exports
Indonesia's mining ministry recommended on Friday that Freeport-McMoran Inc's Indonesian unit be granted a permit to export 1.1 million tonnes of copper concentrates until Feb. 16, 2018, the ministry said in a statement.
The announcement comes after a more than month-long export stoppage that brought production at Freeport's giant Grasberg mine in Papua, Indonesia, to a standstill last week that helped push copper prices to near 21-month highs.
The ministry also recommended that fellow copper miner Amman Mineral Nusa Tenggara be permitted to export 675,000 tonnes of copper concentrate, also up to Feb 16, 2018.
The recommendations were issued to the miners based on commitments made by the pair to develop smelters in Indonesia, the statement said, noting that progress on their smelter projects would be evaluated independently at least every six months.
"Where six-month development progress is not in accordance with commitments, the export recommendation will be revoked."

Thursday, February 16, 2017

1) Government disburses Rp 18.54b trillion for trans-Papua highway

3) Freeport Indonesia mine grinds to complete halt: union

1) Government disburses Rp 18.54b trillion for trans-Papua highway 
Jakarta | Thu, February 16, 2017 | 06:25 pm

A number of vehicles pass along a road in Tageneri in Puncak Jaya regency, Papua, on Aug. 29, 2016. Mud frequently covers the road, particularly after heavy rains and landslides. (Antara/Iwan Adisaputra)

The government has so far disbursed some 18.54 trillion (US$1.39 billion) for the construction of the trans-Papua highway, which is being funded by multi-year state budgets from 2015 to 2017, an official has said.
Public Works and Housing Ministry’s Bina Marga (road agency) director general Arie Setiaji M said that  Rp 5.78 trillion would be disbursed this year.
“As much as Rp 4.06 trillion is being allocated to construct the road and bridges in Papua, while another Rp 1.71 trillion is [for projects] in West Papua,” Arie said as reported by on Wednesday.
The total length of the trans-Papua highway is 3,259 kilometers, consisting of 10 road sections, Arie said, adding that the government had so far developed 2,789 kilometers.
He added that 1,570 kilometers of the road had been laid with asphalt. (bbn)




Jayapura, Jubi – Indonesia has less than three months to deliver “full and free” press access to Papua provinces, says PFF, the Pacific Freedom Forum.
“Jakarta risks global condemnation if it continues to ignore the facts,” warns PFF Chair Monica Miller. ”
A visit last month by media freedom campaigners proves that access for Papua press is still far from full and free”, she says.
Violence, Bullying, Sexual Harassment
An eight person delegation from MFCI, the Media Freedom Committee Indonesia, visited the Papua towns of Jayapura, Merauke and Timika, between 29 January to 3 February 2017. Their reported findings include :
– Ten cases of violence against journalists that are still not resolved. – Only 16 foreign press were given permits to visit Papua last year, with 11 forced to accept government guides.
– Different treatment from Indonesian officials for indigenous journalists versus Indonesian journalists – such as stigmatisation and intimidation of “OAP” – ‘original Papua persons’.
– Local press still need police permits to cover public gatherings, including protests.
– Women journalists routinely suffer bullying and sexual harassment from government sources, but rarely report it to police because they “take it for granted.”
– In an atmosphere of surveillance, intimidation and harassment, media outlets find it impossible to recruit new reporters. One training session for newcomers saw 30 people on the first day, 12 the second day and none the third.
– Business models threaten independence of Papua media, including in Timika, where ad revenues are sourced from Freeport mine, its subsidiaries and local government.
– Threats against independence include pressure from “certain parties” on mass media not to cover environmental issues.
– Isolation from other media due to a lack of access to communications resources causes ethical lapses.
Supported by WAN-IFRA, the World Association of Newspapers and News Publishers, under its Strengthening Media and Society programme, the MFCI visit was also backed by the Denmark ministry of Foreign Affairs. PFF welcomes the input from WAN-IFRA, and praises the leadership role played by Denmark.
“Other diplomatic partners in Jakarta need to do much more to support press freedom,” says Miller.
“Their continued silence on abuses against the press and other human rights compares shamefully with billions in profit being made from Papua by outside interests.”
Findings from the MFCI visit join recent wide concern expressed about Indonesia blocking access to 800,000 websites. Among blocked sites is SuaraPapua – the Voice of Papua – a news outlet exposing human rights abuses.
Voice for the voiceless
PFF praises LBH Pers, the Legal Aid Institute for the Press, for representing SuaraPapua as a “voice for voiceless.” Last year, PFF laid down a deadline for open access to Papua, in the lead up to Indonesia hosting World Press Freedom Day on 3rd May 2017. The deadline was reportedly rejected by a minor official at the Indonesian embassy in Wellington, New Zealand.
Think Carefully
However, PFF has not been able to get confirmation of the alleged rejection from Jakarta.
“Instead of speeding up preparations for World Press Freedom Day, Jakarta appears to be slowing down”, says Miller.
“Make no mistake, Jakarta needs to think very, very carefully about its continued failure to fulfil its own promises, its own guarantees for media freedom under the Indonesian constitution, and its signature to many international treaties.”
Ahead of #WPFD2017, PFF is calling on journalists everywhere to focus attention on one of the world’s least reported areas.
“This year, global journalists must all prove themselves wantoks of the Papua press”, she says. Indonesia improved eight places between 2015 and 2016 on the RSF, Reporters Sans Frontiers World Press Freedom Index, at 130 of 180 countries, but is still coded red for a generally “bad” situation. (*)


COMMODITIES | Thu Feb 16, 2017 | 7:13am EST
3) Freeport Indonesia mine grinds to complete halt: union
By Fergus Jensen and Wilda Asmarini | JAKARTA
All work has stopped at Freeport-McMoRan Inc's giant copper mine in Indonesia and its workers are planning a demonstration against the government's move last month that halted exports of copper concentrate to boost domestic industries, a union said.
A prolonged stoppage at the world's second-biggest copper mine would support copper prices, near 21-month highs this week, but would also deny the Indonesian government desperately needed revenue from one of its biggest taxpayers.
Freeport had said the Grasberg mine would have to slash output by 60 percent to approximately 70 million pounds of metal per month if it did not get an export permit by mid-February, due to limited storage.
But a strike at Freeport's sole domestic offtaker of copper concentrate, PT Smelting, expected to last at least until March, has limited Freeport's output options, and Grasberg's storage sites are now full.
"Everything has stopped completely. It's just maintenance now," Freeport Indonesia worker union chief Virgo Solossa told Reuters on Thursday, stopping short of saying how many of an estimated 33,000 workers had been sent home.
Thousands of workers plan to stage a demonstration on Friday in Timika, Papua, the province where the mine is located, to demand the government makes "a wise decision" regarding their situation, Solossa said.
"If they aren't careful, this has and will impact (Freeport operations), both for workers as immediate beneficiaries and the broader community as recipients of benefits from Freeport's presence."
Solossa added further action would be considered following the demonstration on Friday.
When asked about the stoppage, Freeport Indonesia spokesman Riza Pratama referred to the domestic smelter strike, and told Reuters that Grasberg's production was now being "managed to supply PT Smelting when their operations return to normal."
He noted Freeport did not have any plan to announce a force majeure yet. 
"We are continuing to cooperate (with the government) so that our exports of concentrate can return to normal,” Pratama said.

Freeport estimated in January that sales of copper from Grasberg would reach 1.3 billion pounds in 2017, up from 1.05 billion pounds in 2016, assuming operations were normal.
Coal and Minerals Director General Bambang Gatot declined to comment on the work stoppage and planned demonstration, but said the company had not applied for an export permit yet.
"Let's see what happens tomorrow," he said.
Indonesia introduced rules earlier this year requiring Freeport and some other miners to shift from their current 'contracts of work' to so-called 'special mining permits', before being allowed to resume exports of semi-processed ores and concentrates.
Phoenix, Arizona-based Freeport has said it will only agree to a new mining permit with the same fiscal and legal protection in its current contract.
The company has made direct contributions of more than $16 billion to Southeast Asia's biggest economy in taxes, royalties, dividends and other payments between 1992 and 2015, according to company data.
Copper was down 0.7 percent at $6,027 a tonne on Thursday, holding near a 21-month high of $6,204 touched on Monday.[MTL] 
(Editing by Joseph Radford and Mark Potter)

1) West Papua media access still fettered - PFF

2) The opportunism of defending the nation
3) Government ignores Freeport’s threat to lay off workers
4) Freeport lays off 25 senior employees
5) Korindo has violated deforestation ban, NGO reveals

1) West Papua media access still fettered - PFF

4:57 pm today 

             RNZI's Johnny Blades and Koroi Hawkins interview Papua Governor Lukas Enembe Photo: RNZI/Koroi Hawkins
The Pacific Freedom Forum says Indonesia is yet to deliver on its promise of full and free access for journalists to West Papua just months out from Jakarta hosting World Press Freedom day.
Indonesia opened access to West Papua for foreign journalists in 2015, more than 50 years after annexing the territory from the Netherlands.
The Forum's co-chair, the Papua New Guinean journalist, Alex Rheeney, said a visit by journalists to West Papua in January encountered violence, sexual harassment and interference from Indonesian minders.
"The findings that have come out recently from Papua by the group of journalists who went in, does not show that the Indonesian government is taking the undertaking that it's given to the international community, to give journalists access to West Papua freely and without any strings attached."
Alex Rheeney said the journalists were most likely obstructed when trying to report on the independence movement of West Papua's indigenous population.


2) The opportunism of defending the nation
Julia Suryakusuma Author of Julia’s Jihad
Jakarta | Thu, February 16, 2017 | 10:36 am

A sense of nationalism -- Defense Minister Ryamizard Ryacudu puts a pin to one of Bela Negara (state defense) program recruits in an inauguration ceremony in Skouw-Wutung, at the Indonesia-Papua New Guinea border, on Tuesday. (JP/Nethy Dharma Somba)

When you think of art, what comes to mind? It could be anything and everything under the sun — but the military probably would not be the first thing you think of, right?
So I was intrigued when I received an invitation for an art exhibition held last Monday, which was opened by Defense Minister Gen. (ret.) Ryamizard Ryacudu. The exhibition was called “Bela Negara” (Defend the Nation) featuring 36 painters who displayed their works with various themes: human interest, religion, nature and some with nationalistic themes befitting the exhibition’s title. It was attended by other military figures such as Air Force chief of staff Air Marshal Hadi Tjahjanto, the ministry’s secretary-general Vice Admiral Widodo and Defense University rector Lt. Gen. I Wayan Midhio. Luckily it was also attended by collectors and the painters themselves, otherwise it could have been mistaken for a military convention!
So why “Bela Negara” and why Ryacudu? Because that’s the name of his pet project. It’s a program created out of his and the Indonesian Military’s (TNI) concern over what they see as increasing disharmony of the nation, particularly following the rise of increased Islamic fundamentalism and also what they perceive to be the rise of leftist ideas. The Bela Negara program is thus a new initiative to instill and promote patriotism, nationalism and Pancasila (state ideology) values among the public.
Wait. Is this the Ryamizard Ryacudu who said that suspected communists deserved to die? And that the LGBT (lesbian, gay, bisexual and transgender) movement in Indonesia was part of a proxy war to conquer Indonesia?
It would hardly be the first time that the military has stoked up fears to justify their role as guardians of the nation’s security. In fact that was how Soeharto’s military dictatorship justified its rule for 32 years: the fear of communism.
Well, we know that the Indonesian Communist Party (PKI) has historically been the arch enemy of the military since the early days of independence and even before. But excuse me, the PKI has been defunct for a while now, and even in the world there remain only five countries — China, North Korea, Vietnam, Laos and Cuba — who still claim to be communist. But Karl Marx would not be able to recognize his manifesto as in its original form, it’s dead. And when the Chinese go around the world, they’re not spreading communism, they’re expanding the market economy in one of its wildest forms. Duh.
As for the LGBT movement being part of a proxy war to conquer Indonesia—that’s about the silliest, most risible idea ever. OK, the military may be one of the most macho institutions in the world, but how come even after the United States repealed its “don’t ask, don’t tell” policy for its LGBT personnel in 2011, it remains the world’s strongest military force? Indonesia would be wise to look to the US in this regard.
The way that Ryacudu and his ilk see it, sexual orientations and gender identities other than heterosexuality is brought in from abroad, and not something inherent in our own cultural tradition. This is actually untrue, alternative sexualities have existed in Indonesian traditional culture for a long time.
What do homophobia and communism have in common? They are seen as an external threat, which is what the military needs to justify its existence and activities.
So okay, given this tendency, is the Bela Negara program justified? As someone who grew up in the New Order, to me it smacks of the old Pancasila indoctrination courses, and seems to be a cheap version of compulsory military service. Cheap because it only involves some militarylike exercises, because if it were really serious, it would involve training in weaponry, including bombs, and also war simulation. And that would make it way too expensive.
The Bela Negara program — funded by the state budget — is said to be mandatory for all men up to the age of 50, which is pretty nuts. The idea of a reserve army is not a bad one, but it’s enough to recruit them from high school or at the most, university graduates. In practice, the program seems to mainly recruit preman (thugs) and members of the Islam Defenders Front (FPI) who are only too happy to join. In fact, Ryacudu said that even members of the Islamic State (IS) radical movement are allowed to join. Yes readers, you can roll your eyes, as I did!
The idea for the program already emerged during Joko “Jokowi” Widodo’s presidential campaign, endorsed by Megawati Soekarnoputri. He wanted it to be part of his revolusi mental (mental revolution) to instill a love of the nation as a bulwark against supposedly negative influences (liberalism, immorality, lack of discipline, corruption, etc.) and to train the younger generation to work, work, work — his campaign slogan.
How na├»ve Pak Jokowi! You walked right into the hands of military hard-liners like Ryacudu and TNI commander Gatot Nurtantyo, didn’t you?
Imparsial, an Indonesian NGO founded by the murdered activist Munir, which monitors human rights, is critical of the program. Gufron Mabruri, its deputy director, considers the concept behind the program unclear, difficult to understand, narrow and tends to be militaristic. Imparsial thinks it should be run by the ministry overseeing culture, not defense. Not only is it militaristic, if it recruits “Islamic” thugs then the program, which claims to be fighting Islamic radicalism, would be in fact supporting it. Oh dear! So what really is behind the Bela Negara program? It’s just a project, and in the end it’s all about money, money, money. Think of all those uniforms that need to be made, the tents, the catering and so many things needed for the program. History has shown that procurements such as this is prone to corruption, collusion and nepotism (KKN), the very thing it claims it wants to eradicate.
So why did the organizers of the Bela Negara painting exhibition ask Ryacudu to open the exhibition? Basically, opportunism. It’s an ongoing government program, it sounds good, and Ryacudu is in power. I wouldn’t take them too much to task for that, but the broader implications are depressing.
There is one consolation though: the program will fail because the necessary budget is just not available. At a time when the government is under severe fiscal constraint, why is this doubtful program being allowed?
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Disclaimer: The opinions expressed in this article are those of the author and do not reflect the official stance of The Jakarta Post.

3) Government ignores Freeport’s threat to lay off workers
Jakarta | Thu, February 16, 2017 | 11:02 am

The government has ignored a threat from gold and copper mining company PT Freeport Indonesia, the country’s biggest taxpayer and major employer, to lay off its workers if an agreement with the government failed to be reached.
“If it is part of pressure, just ignore it,” said Coordinating Economic Minister Darmin Nasution, as reported by on Wednesday.
Darmin said Freeport had demanded legal guarantees from the government that the current policy would not change if there were a change in the government.
Such certainty was demanded with regard to the amount of taxes the company paid and the continuity of its operations in Indonesia, Darmin said.
The taxes the company paid were, in fact, on a declining trend, but the company had doubts about whether such a policy would be maintained if there were a change in government, Darmin said.
Previously, Freeport Indonesia spokesman Riza Pratama said the company needed a stable investment agreement with the Indonesian government on the conversion of its contract of work (CoW) to a special mining license (IUPK).
Riza stressed that such an agreement was important for Freeport, because it was related to its long-term investment plan in Indonesia.
The government has barred the company from exporting its concentrate, saying the export licenses would be issued soon after the company signed an agreement that included a commitment to build a smelter and sell stakes to Indonesian entities. (bbn)  


4) Freeport lays off 25 senior employees
Jakarta | Thu, February 16, 2017 | 04:11 pm
Gold and copper miner PT Freeport Indonesia has laid off 25 senior employees as the company negotiates with the government regarding the conversion of its contract of work (CoW) to a special mining license (IUPK).
Freeport Indonesia spokesperson Riza Pratama said in principle, the company had agreed to convert its CoW to adjust to the new regulation.
“There are 25 [who were laid off] at the senior official level,” Riza confirmed, adding that the company had also informed its contractors to change their operation plans and reduce its number of employees.
Freeport Indonesia employs some 32,000 people totally, including the staff of its contractors. “If we cannot export, it is possible that reductions of our workforce may continue,” Riza added.
“We are ready to convert to the IUPK if there is an agreement on investment legal and fiscal stability assurances like in the CoW,” said Riza as reported by
Freeport also wants the contract to be extended to 2041, as well as ensuring its unchanged tax status. The government has yet to respond to Freeport’s proposal.
Freeport has temporarily stopped operations despite still having large stocks of mineral concentrates. (bbn)


5) Korindo has violated deforestation ban, NGO reveals
By Vaidehi Shah Thursday 16 February 2017
Controversial Korean conglomerate Korindo pledged to stop clearing forests until it had conducted proper sustainability assessments, but campaign group Mighty has gathered evidence to show that Korindo has broken its promiseIt has barely been two months since Korean-Indonesian conglomerate Korindo bowed to demands from environmental activists and announced a moratorium on forest clearing in its palm oil concessions, but campaigners claim that the company has already broken that promise. 
Through satellite images obtained on 13 January 2017—about a month after Korindo’s moratorium announcement—United States based non-governmental organisation Mighty found that Korindo was preparing to clear about 1,400 hectares of forest in an area that it had promised to stop clearing until the land had undergone proper audits to assess its conservation value………… 


Wednesday, February 15, 2017




February 9, 2017
Stranded land is a type of stranded asset. Stranded assets are “assets that have suffered from unanticipated or premature write-downs, devaluations or conversion to liabilities.” Due to stranded assets, the Indonesian palm oil industry may be facing a trend of lower growth and equity revaluations. Banks may be left with poor loan collateral when the underlying oil palm concession is recognized as stranded land. Risks and costs for companies and credit and equity investors are likely to increase. This means that landbank expansion – regardless of location – is a high-risk financial strategy.
Key Findings
  • 6.1 million ha of forests and peatland are “stranded assets” on the balance sheet of Indonesian palm oil companies as it cannot viably be developed. This magnitude is potentially unknown to investors and bankers. Analysts may be mispricing these stranded assets into current financial valuations.
  • 29 percent of Indonesia’s leased out landbank cannot be developed without violating buyers’ No Deforestation, No Peatland, No Exploitation (NDPE) policies. This stranded land is equal in size to ten million football fields.
  • NDPE compliant growers may enjoy wider, more secure markets and be able to sell at higher prices. This could render a full transition to NDPE imminent.
  • With 365 NPDE policies from traders and consumer goods companies, and new regulations from the Government of Indonesia, analysts need to change their financial modeling techniques to include stranded asset discounts.
  • 95 identified palm oil company groups – 35 of which are publicly traded – each hold at least 1,000 ha of stranded land within their concessions.
  • 10 percent of Indonesia’s total land has been leased for oil palm concessions in the last 25 years.
To mitigate business risk, companies may want to focus on improving growth and yield, achieving buyer NDPE policies and alternative growth strategies instead of risky landbank expansion. Only companies that comply with NDPE policies by refraining from developing forests or peatland will retain access to the market segment that demands sustainable production. This segment is quickly becoming mainstream and offers better CPO trade terms.
Ten company groups have over 1 million ha in stranded land:
  • Pacific Inter-Link, Menara Group, Tadmax project
  • Korindo
  • Astra Agro Lestari
  • Gandasawit Utama
  • Hardaya Inti Plantations
  • Salim Group and Indofood Agri Resources
  • Genting Plantations
  • Eagle High Plantations
  • PTT Green
  • Austindo Nusantara Jaya
It is important to note that NDPE compliance is not a guarantee of protection of forest and peatland. Under current Government of Indonesia regulation, growers’ licenses might be revoked if they do not develop their land into palm oil plantations. Licenses can then be redistributed to other actors, including those active in other commodity sectors that are not necessarily bound by any NDPE policy.
Three out of every 10 ha leased to oil palm concessions in Indonesia is stranded land. This land cannot be developed without violating buyers’ No Deforestation, No Peatland, No Exploitation (NDPE) policies. This undevelopable land area is the same size as ten million football fields.
It is important to note that NDPE compliance is not a guarantee of protection of forest and peatland. Under current Government of Indonesia regulation, growers’ licenses might be revoked if they do not develop their land into palm oil plantations. Licenses can then be redistributed to other actors, including those active in other commodity sectors that are not necessarily bound by any NDPE policy.
Four trends are driving this supply chain transformation:
Trend #1: Undeveloped palm oil landbanks are no longer a viable proxy for financial valuation.
Trend #2: 365 companies globally have adopted zero-deforestation or NDPE policies.
Trend #3: The Government of Indonesia is directing the palm oil industry away from deforestation and peatland development to improving growth and yields.
Trend #4: “Eyes in the sky” provide immediate transparency and monitoring capabilities.