Tuesday, October 11, 2011

Indonesia’s Bloody gold

The fresh unrest, which broke out on Monday morning at the mining site of Timika-based copper and gold company PT Freeport Indonesia in Papua and killed one company employee and wounded three others, apparently supports widespread allegations of poor security management in an area notorious for violence.

The unrest also demonstrates the failure to resolve the long-standing sociopolitical problems in the areas surrounding the location of the world’s largest gold mine and third largest copper mine.

Monday’s unrest reveals how both the central and local governments have failed to identify key problems in the region and have only managed to provide provisional, short-lived solutions to address serious problems. It is understandable how short-term approaches to solving problems leave vulnerability to greater and more difficult problems that will eventually have to be settled in the future.

There had not been an official statement regarding the cause of the unrest as of Monday afternoon. One version said that the incidents were triggered by a conflict between company employees. Another version claimed that a group of protesting employees and local people clashed with the police as the former was prevented by the latter from meeting the company’s management. It was in the middle of a chaotic situation that the police opened fire to disperse the crowd, reportedly killing a company employee identified as Piter Ayamiseba. Freeport employees have been protesting for nearly a month in a campaign demanding wage and benefit increases and employee recruitment reforms.

The Timika area is synonymous with Freeport as its growth and development have come along with the company’s businesses and its commitment to developing the area and the Papua province since beginning operations in 1967. As of the first semester of 2011, the company had paid Rp 11.7 trillion (US$1.4 billion) in taxes to the Indonesian government. The company has also contributed to the development of infrastructure in Papua, including urban development, electricity, airports, seaports, roads, schools and hospitals, among other initiatives.

The company is also recognized as having maintained positive relations with military and police personnel, who have been accused of murder, torture and disappearances, including foreign nationals. Based on Freeport’s own confessions to the US Securities and Exchange Commission, millions of dollars have been paid to the Indonesian Military, paramilitary and police units and officials, as well as direct payments for vacations and college educations for family members of individual commanders.

As recently as 2008, Freeport admitted it had paid around “US$1.6 million through wire transfers and checks to provide ‘monthly allowances’ to police and soldiers at and around the Grasberg mine,” reported Agence France-Presse. The payments were made “in contravention of a series of legal measures aimed at stopping military units working as paid protection.”

The $1.6 million in direct payments were part of $8 million that “Freeport paid to broaden ‘support costs’ for 1,850 police and soldiers protecting Grasberg last year, according to a company report filed with the US Securities and Exchange Commission.”

The shooting on Monday was only a small part of much greater problems in Timika — and Papua in general. While the incident could be settled through transparent investigation and strict punishment against whomever was responsible for the violent clash, more complex problems concerning welfare and equal distribution of wealth and opportunity for local people need urgent attention so as to establish permanent peace and order in the country’s easternmost province.
Editorial, Jakarta Post

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