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  • Indonesia 'Welcomes' Foreign Investment

    Good luck in court...

    [SIZE=3]Mining in Indonesia[/SIZE]

    CHURCHILL MINING, a London-listed firm, announced in May 2008 that it had found 150m tonnes of coal in Indonesian Borneo. This was an underestimate. The firm now thinks there are 2.8 billion tonnes, making it the seventh-largest undeveloped reserve in the world.
    Alas for Churchill, other people quickly grew interested. The Nusantara Group, a conglomerate controlled by Prabowo Subianto, a politician, had previously controlled the mining in that area. Six companies affiliated with Nusantara held licences for six blocks in the East Kutai district of East Kalimantan province, but did not explore for coal. Those six licences expired between March 2006 and March 2007, after which the district government began offering the mining area to other firms. Churchill entered the picture by acquiring a 75% stake in four new licences for the same area, which had been awarded to the Ridlatama Group, an Indonesian company.
    In July 2008, two months after Churchill revealed its discovery, the district chief of East Kutai suddenly extended the six expired licences that had been held by Nusantara’s affiliates, even though Churchill’s local partner had been awarded new licences for the same area. Churchill claims that it has since been the target of a campaign to drive it out of Borneo.

    In May 2010 a new district chief of East Kutai revoked the Churchill-Ridlatama licences, leaving Nusantara-affiliated companies in sole control of the 2.8 billion-tonne reserve. Courts rejected Churchill’s complaints. This week it appealed to Indonesia’s Supreme Court.

    http://www.economist.com/node/21531017
    Last edited by lantern; 09-10-11, 19:59.
    "[COLOR=#000000][FONT=Helvetica Neue]I learned long ago, never to wrestle with a pig. You get dirty, and besides, the pig likes it.[/FONT][/COLOR]"
    George Bernard Shaw

  • #2
    Prabowo Subianto is not just a politician.

    Comment


    • #3
      And if you were a betting man ..you would put your money on which party to emerge victorious from the Supreme Court?
      "[COLOR=#000000][FONT=Helvetica Neue]I learned long ago, never to wrestle with a pig. You get dirty, and besides, the pig likes it.[/FONT][/COLOR]"
      George Bernard Shaw

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      • #4
        It depends on whether the court thinks a district chief has the right to grant and revoke mining licenses at will. I think Prabowo will win this. I'll put my money on him so I'll have some cash to console my sorrow. Even if the Supreme Court rules for Churchill-Ridlatama, it remains to be seen whether that judgment is worth more than the paper it's printed on.

        Comment


        • #5
          Originally posted by Injun View Post
          Even if the Supreme Court rules for Churchill-Ridlatama, it remains to be seen whether that judgment is worth more than the paper it's printed on.
          It's unlikely they would ever move a shovelful of coal.
          "[COLOR=#000000][FONT=Helvetica Neue]I learned long ago, never to wrestle with a pig. You get dirty, and besides, the pig likes it.[/FONT][/COLOR]"
          George Bernard Shaw

          Comment


          • #6
            Indonesian policy- and decision-makers talk incessantly about the need to attract investment, yet they do remarkably little to achieve that goal. When the World Bank asked investors what dissuaded them the most about investing in Indonesia, one of the top three responses was poor law enforcement and administration of justice. So long as Indonesia avoids the bitter pill of conducting thorough and comprehensive reform of these sectors, the dream of foreign investment and broad sustained growth will remain just that, a dream. I mean, none of this is rocket science or brain surgery.
            Last edited by Hombre de Maiz; 10-10-11, 09:06.

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            • #7
              This man aspires to be RI's president yet is prepared to be party to such malpractice for blatant personal gain. Where are the leaders that Indonesia needs?

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              • #8
                Originally posted by john madden View Post
                Where are the leaders that Indonesia needs?
                Busy lining their own pockets?

                Comment


                • #9
                  Blackberry - Google Investment

                  I thought the following article from The Jakarta Globe shows the heart of the problem regarding foreign investment. Especially telling was the reaction of the officials involved in the negotiations. Rather than admit and work on issues, they profess amazement, anger and punitive actions. Those comments might appeal to some of the masses, but does nothing to address the real issues and provide a profitable environment for foreign investment.

                  http://www.thejakartaglobe.com/businesstech/why-google-blackberry-avoided-indonesia/470140




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                  • #10
                    The govt. of Indonesia should stop inviting foreign investors for natural resources exploitations cause eventually it provides no added value... Besides that the natural resources exploitations leaves behind an environmental disaster which can't be fixed again...

                    A simple areal survey in Kalimantan Barat can explain clearly what I mean...

                    They should concentrate on investors of manufacturing plants producing goods or services... This will increase the availability of jobs for the labour and it provides positive added value for the economic of the country...

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                    • #11
                      Yet their response to foreign investors for value added goods are so immature that world is laughing at them. Re: blackberry

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                      • #12
                        The govt. of Indonesia should implement a stronger governance program. FULL STOP
                        The govt. of Indonesia should implement equal rights for foreign companies FULL STOP
                        The govt. of Indonesia should invite mining of natural resources BUT in a sustainable way, whereby if the land is destroyed it should be replanted, if polluted cleaned up. It represents a great deal of the nations wealth, and is something which should benefit the people not a few individuals, and NOT at the cost of destroying the environment.
                        [FONT=Verdana]As a stranger give it welcome.
                        There are more things in heaven and earth, Horatio,
                        Than are dreamt of in your philosophy
                        [/FONT]

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                        • #13
                          Originally posted by kim& mika View Post
                          The govt. of Indonesia should implement equal rights for foreign companies FULL STOP
                          Could you please elaborate a little about this ? Its interesting...

                          Because to me equal rights would also mean that any foreign or local companies should have similar wage levels for expats and local workers...

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                          • #14
                            No it does not that is a choice for the company.

                            It means that the rights of teh companies should be equal, which in Indonesian law they are not.
                            Of course there should be some restrictions, which there is about which industries foreign companies can and cannot invest in, but the rights in law should be the same. The case of Churchill shows exactly how it is not equal
                            [FONT=Verdana]As a stranger give it welcome.
                            There are more things in heaven and earth, Horatio,
                            Than are dreamt of in your philosophy
                            [/FONT]

                            Comment


                            • #15
                              Originally posted by roysingh View Post
                              The govt. of Indonesia should stop inviting foreign investors for natural resources exploitations cause eventually it provides no added value... Besides that the natural resources exploitations leaves behind an environmental disaster which can't be fixed again...

                              A simple areal survey in Kalimantan Barat can explain clearly what I mean...

                              They should concentrate on investors of manufacturing plants producing goods or services... This will increase the availability of jobs for the labour and it provides positive added value for the economic of the country...
                              For once, something from Roy that I can endorse.

                              ...one the other hand, Indonesia's competitiveness in those other alternative sectors is not very high.

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