The gold mine attack
It is the local people, notably the 200 workers and their families, and Indonesian and Australian investors who immediately suffered losses after the temporary closure of the PT Sorikmas Mining (SMM) gold exploration project in North Sumatra’s Mandailing Natal regency on Sunday.
The Indonesia-Australian gold mining joint venture was forced to stop operations after hundreds of residents from the nearby village of Hutagodang Muda village attacked and burned an SMM camp on May 29, destroying buildings worth an estimated US$7 million and $20 million in mining samples.
We wonder why the local police and local administration failed to detect the dispute between the community and the mining firm. After all, it was not the first time SMM had been embroiled in a climate of hostility with the local people.
The mining company began exploration on a gold mining concession of 66,200 hectares in 1999, but had to stop operations in 2004 due to lack of support from the local administration. It resumed exploration in 2009 after winning a legal decision from the Supreme Court that further validated the legitimacy of its concession.
Whatever the reason behind the violence, the police should enforce the law against the perpetrators of the attacks.
Since SMM gained the concession during Soeharto’s New Order, the company seemed to have suffered from the notorious perception that, like most other major mining firms before 1998, SMM also had obtained its mining contract through collusion and corrupt practices.
The Supreme Court ruling in 2009 should have resolved, once and for all, the controversy over the legitimacy of its concession. As the latest incidents have shown, the political and social environment in the Mandailing Natal regency remained unfavorable.
This is really a challenge for both the central government and local administration to thoroughly investigate because past experiences have shown that such protesters may have genuine causes and legitimate grievances, but several others may hide self-serving interests.
Certainly, business is not always right and those that are found guilty of violating the laws should be brought to justice. On the other hand, those not guilty and find themselves being harassed and subjected to spurious claims should be protected by the government.
If such protests are not handled properly, businesses will be at the mercy of lynch mobs and the law of the jungle.
Simply ordering the closure of a mine without due process of the law boils down to the government succumbing to mob ultimatums and would set a bad precedent that could threaten the fate of many other resource-based investment ventures. Only when there is legal certainty and consistency in law enforcement can the course of investment be reasonably predicted and big investors will become more interested in investing their capital in Indonesia.
It is often unpopular to defend large companies, especially foreign firms, but we should stand up in defense of all legitimate businesses, be they foreign or domestic, as long as they abide by the law.
The Indonesia-Australian gold mining joint venture was forced to stop operations after hundreds of residents from the nearby village of Hutagodang Muda village attacked and burned an SMM camp on May 29, destroying buildings worth an estimated US$7 million and $20 million in mining samples.
We wonder why the local police and local administration failed to detect the dispute between the community and the mining firm. After all, it was not the first time SMM had been embroiled in a climate of hostility with the local people.
The mining company began exploration on a gold mining concession of 66,200 hectares in 1999, but had to stop operations in 2004 due to lack of support from the local administration. It resumed exploration in 2009 after winning a legal decision from the Supreme Court that further validated the legitimacy of its concession.
Whatever the reason behind the violence, the police should enforce the law against the perpetrators of the attacks.
Since SMM gained the concession during Soeharto’s New Order, the company seemed to have suffered from the notorious perception that, like most other major mining firms before 1998, SMM also had obtained its mining contract through collusion and corrupt practices.
The Supreme Court ruling in 2009 should have resolved, once and for all, the controversy over the legitimacy of its concession. As the latest incidents have shown, the political and social environment in the Mandailing Natal regency remained unfavorable.
This is really a challenge for both the central government and local administration to thoroughly investigate because past experiences have shown that such protesters may have genuine causes and legitimate grievances, but several others may hide self-serving interests.
Certainly, business is not always right and those that are found guilty of violating the laws should be brought to justice. On the other hand, those not guilty and find themselves being harassed and subjected to spurious claims should be protected by the government.
If such protests are not handled properly, businesses will be at the mercy of lynch mobs and the law of the jungle.
Simply ordering the closure of a mine without due process of the law boils down to the government succumbing to mob ultimatums and would set a bad precedent that could threaten the fate of many other resource-based investment ventures. Only when there is legal certainty and consistency in law enforcement can the course of investment be reasonably predicted and big investors will become more interested in investing their capital in Indonesia.
It is often unpopular to defend large companies, especially foreign firms, but we should stand up in defense of all legitimate businesses, be they foreign or domestic, as long as they abide by the law.
The dynamic equilibrium
An international security conference in Singapore over the weekend lent credence to Indonesia’s vision of a “dynamic equilibrium” in the evolving geopolitical sphere of the Asia-Pacific region.
The Shangri-La Dialogue (named after the Singapore hotel at which it is held), an annual conference of defense ministers and experts, impressed upon participants and observers what this loosely defined idea might mean in terms of international relations.
In theory, a dynamic equilibrium would accommodate the roles and responsibilities of Asia’s new powers (China and lately India), recognize the geopolitical interests of the US and define a role for “middle” powers, particularly for those nations within ASEAN.
As Indonesian Defense Minister PurnomoYusgiantoro told the forum, a new security arrangement “should be geared to avoid any domination by being inclusive and transparent. It should also ensure stability through cooperation and address common challenges instead of developing alignments that are directed at one another.”
The emphasis was clearly on dialogue and cooperation. This approach takes into account the major geopolitical shifts that are taking place with the peaceful rise of China and India as economic and political powers, as well as assigning roles and places to medium and smaller states to promote peace and security in the region.
It is also clear from statements by defense leaders and experts that the US will continue to play a major role in Asia, not only because of its geopolitical interests, but more because it is a Pacific power, a geographic fact that no one can deny.
During the forum, US Defense Secretary Robert Gates offered a US$100 bet that America’s presence in Asia “will remain strong if not stronger” in spite of its weakening economy.
His wager may be a moot point since he is retiring soon, but the message is clear that the US will be part of the emerging security architecture. In this context, we welcome the expanded dialogue that US and China defense officials are holding to overcome their mutual suspicions.
Indonesia in the meantime should look for any opportunity to help shape a regional security structure that best serves its national interests.
A dynamic equilibrium seems the way to go.
The Shangri-La Dialogue (named after the Singapore hotel at which it is held), an annual conference of defense ministers and experts, impressed upon participants and observers what this loosely defined idea might mean in terms of international relations.
In theory, a dynamic equilibrium would accommodate the roles and responsibilities of Asia’s new powers (China and lately India), recognize the geopolitical interests of the US and define a role for “middle” powers, particularly for those nations within ASEAN.
As Indonesian Defense Minister PurnomoYusgiantoro told the forum, a new security arrangement “should be geared to avoid any domination by being inclusive and transparent. It should also ensure stability through cooperation and address common challenges instead of developing alignments that are directed at one another.”
The emphasis was clearly on dialogue and cooperation. This approach takes into account the major geopolitical shifts that are taking place with the peaceful rise of China and India as economic and political powers, as well as assigning roles and places to medium and smaller states to promote peace and security in the region.
It is also clear from statements by defense leaders and experts that the US will continue to play a major role in Asia, not only because of its geopolitical interests, but more because it is a Pacific power, a geographic fact that no one can deny.
During the forum, US Defense Secretary Robert Gates offered a US$100 bet that America’s presence in Asia “will remain strong if not stronger” in spite of its weakening economy.
His wager may be a moot point since he is retiring soon, but the message is clear that the US will be part of the emerging security architecture. In this context, we welcome the expanded dialogue that US and China defense officials are holding to overcome their mutual suspicions.
Indonesia in the meantime should look for any opportunity to help shape a regional security structure that best serves its national interests.
A dynamic equilibrium seems the way to go.
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