| JAKARTA, Sept 8
JAKARTA, Sept 8 Indonesia's mining ministry is
scrambling to find a way around a deadline on mineral processing
that could prevent some miners, including U.S. copper mining
giant Freeport-McMoRan Inc, from exporting minerals from
the country from 2017.
Under a government regulation introduced in 2014, miners of
copper, zinc, lead, manganese and iron are restricted to
exporting partially processed minerals until January 2017, after
which only shipments of refined metals will be allowed.
The export curbs - which have cost Indonesia billions of
dollars in lost revenue - were intended to shift sales from
unprocessed raw materials to higher-value finished metals, but
smelters have been slow to materialise as low commodity prices
have made them economically unviable.
The government is now "comprehensively evaluating (the
requirements) for each commodity," coal and minerals director
general Bambang Gatot said on Thursday, referring to meetings on
the rule with acting mining minister Luhut Pandjaitan.
Uncertainty over Indonesia's mining rules have been a
flashpoint between miners and the government for years. The
sector accounted for almost 6 percent of Indonesia's GDP before
the 2014 ban on metal ore exports, and has since slipped to
about 4 percent.
Also of concern to Jakarta, the government's non-tax revenue
from mining missed its target by 43 percent last year.
"There will definitely be a solution ... at least by
January," Gatot said, noting that the government was discussing
whether it needed to change the law or revise a regulation.
Earlier this week, acting mining minister Pandjaitan said
the government had been too slow in implementing domestic
processing requirements mandated in Indonesia's existing 2009
"The implementing regulation only came in 2014, so there's
no way they could build smelters (in time), and what's more
commodity prices were down," Pandjaitan said.
"Now we are trapped with how to continue applying the mining
law properly. We can't change the law just like that," he said.
The 2017 deadline would not apply to nickel ore or bauxite,
exports of which have been completely banned since 2014.
The rules on those ores were also "still being discussed,"
The government has been rolling out new measures to
re-energise Southeast Asia's largest economy after growth cooled
to its slowest in 6 years in 2015, partly as a result of weaker
returns from commodities.
The government is also seeking new revenue sources, with a
fiscal deficit expected to widen to 219 trillion rupiah ($16.8
billion) this year.
Freeport, Indonesia's largest copper miner and an important
source of government revenue, has said it is confident the
government will not push ahead with the 2017 deadline, as the
move could harm Southeast Asia's biggest economy.
($1 = 13,067 rupiah)
(Reporting by Wilda Asmarini; Writing by Fergus Jensen; Editing
by Tom Hogue)