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CORRUPTION-INDONESIA: Papuans Set for Showdown With US Gold Miner
By Kafil Yamin
JAKARTA , Mar 2 (IPS) - After two weeks of protests and a sustained blockade, the United States miner, Freeport-McMoran, continues to hang on to the world's largest gold and copper mine in eastern Papua province, on the strength of assurances from the central government.
Residents of Kali Baru and Banti villages have been blockading the company's mining site in Tembaga Pura and forced the company to halt operations over the past week.
Freeport stands accused by the people, the provincial government of Papua and non-government organisations (NGOs) of colluding with corrupt military and other central officials, to fleece the mines and degrade the environment around the mine located deep in the remote snow-capped central highlands.
Papua's legislative house and the Papua People's Assembly have been firm that Freeport must shut down. ''We have asked the central government in Jakarta to close down Freeport,'' Papua house speaker Komarudin Watubun told a crowd of 300 demonstrators staging a rally on Tuesday. ''We want a total closure of the company.''
Joining the chorus is one of Indonesia's prominent political leaders, Amien Rais, who said, last week, that Freeport should be closed down for ''three big crimes''.
''The first is ecological crime by destroying land and environment. The Ajkwa river that was once clean and green has now become a heap of tailing.'' The second, he said, was ''robbery by channeling concentrates of gold and copper from Jayawijaya mountain top through a 100 km pipe to the Arafura sea and taken overseas for decades, unreported.''
Rais said he had reliable data to show that only three percent of mined concentrates of gold and copper were accounted for.
''The third is tax crime,'' he said, demanding that President Yudhoyono review the Freeport contract. Freeport is already Indonesia's biggest tax-payer.
On Wednesday, the protesters managed to meet James Moffet, commissioner of Freeport. Negotiations have continued but tensions have been running so high that clashes have broken out with Indonesian security forces who are paid, illegally, by the company.
Meanwhile in Jakarta, NGO activists and the Papua students have been marching to the Freeport office in South Jakarta demanding closure of the company and clashing with police.
Last week, the protesters turned violent and rampaged through the building destroying furniture and breaking window panes. The arson stopped only after police fired warning shots.
Facing frequent protests, including attacks on its workers, Freeport has sought Indonesian military protection by paying off high-ranking military generals and police officers.
An investigation by the London-based NGO, 'Global Witness' has revealed names of military and police officers who personally received money from Freeport in what the company calls 'pay for protection'. Brig Gen Ramizan Tarigan admitted he received 14,000 US dollars during 2002.
In April 2002, Freeport gave the then Papua military chief Maj Gen Mahidin Simbolon 64,000 dollars in what the company dubbed as 'fund for 2002 military project'. In December of that year, Simbolon received another 67,000 dollars for 'humanitarian civic project', according to Global Witness. Simbolon is now the inspector general of the Indonesian Army.
In 2003, as the U.S. government imposed stricter assessment on companies, Freeport switched to paying police and military units instead of persons. During that year, the company paid Indonesia's military police and paramilitary 200,000 dollars.
Freeport has spent at least 20 million dollars from 1998- May 2004 on military and police officers in Papua, according to the Global Witness investigation. Several former managers interviewed by Global Witness said at least 10 million dollars more were paid after 2004.
Freeport is also accused of obscuring its real revenue, prices of copper and gold and tax fraud. The government is now setting up a team to assess Freeport transactions.
Vice President Yusuf Kalla said there is an urgent need to review the Freeport contract with the Indonesian government. ''If they (Freeport) are proved to have scammed taxes, prices and other unfair dealing, we will certainly impose a legal sanction,'' he told journalists in Jakarta, last week.
The review team will comprise officials from the ministries of finance and of energy and mining, with the assistance of several legislators.
But even as the team is in the making, the Indonesian military and police has sent in more troops to the company's base in Papua to deal with the people's blockage.
Last Thursday, Freeport denied it gave dollars to the Indonesian military officials as suggested by Global Witness. But the company acknowledged that it has provided the military guarding the mining site with logistic assistance. ''We don't bribe. We do give assistance to the military, not in cash, but in the form of field equipment such as handy talky, cars, food,'' said AR Soehoed, a Freeport official.
Soehoed said the company needs to ensure security at its mining sites and due to challenge in the field, the military needed good facilities. ''All payments are transparent and reported to the New York Stock Exchange,'' he said. ''And assisting security personnel on duty is just normal. If you give some food to your starving guard, that is normal, right?'' (END/2006)
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