Indonesia's president orders that at least 70 percent of mining revenues must benefit the state
Indonesian President Prabowo Subianto has called for at least 70 percent of the revenues from all mining permits in the country to be enjoyed by the state, opening the option for the government to take control of mining company shares to ensure that the benefits of resource management are shared more widely among the Indonesian people. 'I have instructed the ministers, especially the Minister of Energy and Mineral Resources. Starting now, for all mining permits, at least 70 percent must be enjoyed by the state,' Prabowo said in a speech at the opening of the Tanwir conference and the 114th anniversary of Muhammadiyah, one of the country's largest Islamic organisations, in Palu, Central Sulawesi, on Saturday.
Prabowo said the government may take over shares in mining companies if necessary, though investors could still invest if the state required additional capital for mining operations. But once investors have recouped their capital, he stressed, the majority of the profits must be retained by the Indonesian people. 'If necessary, let's control the shares. If not, because we need capital, we may accept their investments. They will get their capital back, but after that, the majority of the profits should belong to the Indonesian nation,' he said, adding that he was confident the policy's benefits would be felt within a few months.
A single channel for all exports
Alongside the mining revenue rules, Prabowo outlined an export oversight policy under which all export activities must now go through a single channel, an agency appointed by the government, to prevent the manipulation of export quantity reports. 'All exports must now go through one channel, that is through the agency we designate, so that the country can no longer be deceived,' he said. He cited the practice of reporting exports that do not match the actual quantity of goods shipped: 'If the export is 100 tons, then report 100 tons. If 100 tons are exported, do not report only 50 or 30 tons.'