Stopping political elite from meddling in mining


I wrote this for the Jakarta Post on 24 March 2006. Some foreign journalists were ribbing me for not naming the political elites behind the demonstrations against foreign companies. My reply was that I write opinion, they report and if they were good at reporting they would have named the political elite.

Kudos to the Indonesian Chamber of Commerce and Industry (Kadin) for asking the political elite to refrain from stirring up protests directed at foreign mining companies.

It is a step in the right direction as it is high time an Indonesian institution of some stature spoke up for foreign investors against the tyranny of the so-called political elite.

The mining industry, headline grabbing though it may be these days, is only the tip of the iceberg when it comes to investors being bullied by the political elite.

Time and again many a foreign investor has stood helpless and alone once a member of this political elite chooses to make them or their industry a target. The political elite has only to make an accusation, no matter how wild it is, and the damage is done. The investor stands accused and because they are foreigners, are hesitant to speak out in an assertive manner to clear their name, for fear of provoking even stronger reactions.

Besides, the accused party rarely has credibility in protesting its innocence. Most attempts at this exercise make them sound as if they are defensive or are whining about their situation, which then makes matters worse.

They then look around for help, for someone who would not necessarily endorse their actions, but just to advocate fair play and a rational approach to issues. Usually they find no one. Not among the more well-known human rights campaigners and politicians because they have their own reputations to protect and being seen to advocate for big business does not endear them to their constituents; not among the various industry associations because they are usually staffed by bureaucrats or veterans in sinecure positions; and not among the various commissions and NGOs sworn to protect the people because they do not want to upset each other.

So foreign investors are left entirely alone to fend for themselves whenever the political elite decides to attack them. In their isolation, many of these foreigners must wonder what sort of a society in decay it is here where, to paraphrase Yeats, the best lack all conviction while the worst are full of righteous piety.

At worst many of them must seriously contemplate pulling out their investments from Indonesia; at best they would still relate their experience as a parable of admonishment to their fellow investors who are eying Indonesia.

This is why Kadin's recent move to warn off political elite from fanning protests against mining companies is such a positive step forward for investment. Finally, foreign investors can count on an institution of standing in the Indonesian community to try to keep the playing field a bit more level and temperatures surrounding issues a bit cooler. This will give all parties concerned more breathing space to resolve their differences and come to amiable solutions.

Kadin should perhaps now keep up the momentum by assuming a leading position in issues management and resolution. Led by well-respected businesspeople with the ear of government ministers as well as foreign investors, Kadin is well positioned to ensure that controversial issues are resolved satisfactorily.

It does not have to take sides, merely to ensure that all parties are being fair in their approach toward issues. The Freeport issue is a case in point. Kadin can, for instance moderate a roundtable of principal players where Kadin can set very specific questions for all parties to answer, such as what exactly are the complaints against Freeport and what are the reasons to support such complaints; who exactly has issue against Freeport and why do they need to resort to violence; what are Freeport's response to such complaints and what are both sides' suggestions to resolve the issue? And then print it as a white paper on the issue.

Such actions would not necessarily solve issues overnight but it would go a long way toward bringing some element of rationale to controversial issues.

True, Kadin should not really be involved in such activities but it would appear that it has to out of default as the other institutions have reneged on their functions. The press, the so-called fourth estate, is often more interested in repeating unsubstantiated allegations, sometimes the wilder the better, rather than practice responsible reporting; the self-styled human rights champions and social commentators do not want to make enemies of the political elite; ministers are usually too slow or lacking in political will to resolve anything decisively.

Indonesia remains a great place for investment and many foreigners know this. They want to put their money here and they are usually big boys, they can fend for themselves; but this country owes them an obligation to keep the playing field level in return for the money they bring in and the jobs they create.

Of course, foreign investors should act responsibly, adhere to all Indonesian laws and use their financial clout and know-how to benefit the community. Many of them already do that, all they need is someone to keep the hounds of the political elite at bay so that they can go about their business without fear of unjustified and unwarranted attacks.

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