Abitibi Metals boosts resource by 62% at B26 polymetallic deposit in QuebecÂ
Indicated resources increased to 11.3 million tonnes from 6.9 Mt.
A prominent Indonesian businessman has warned foreign miners of the perils of investing in his own country over the next two years due to new laws which curb overseas ownership.
The Australian reports that Noke Kiroyan, a veteran of the Indonesian mining industry who previously headed Rio Tinto (ASX:RIO) and Newmont Mining’s (NYSE:NEM) operations in the archipelago nation, has said rampant nationalism was making mining investment by foreigners far more risky, pointing to the ambiguity of new laws which force overseas companies to cede majority ownership to local businesses.
Kiroyan, who made the remarks during a visit to the Western Australian capital of Perth, says the new laws are unlikely to be changed until the next round of elections in 2014 when incumbent President Susilo Bambang will resign from office.
“The only realistic option is to wait until the next administration because it is this current administration that has changed it,” said Kiroyan.
The new laws stipulate that foreign miners must cede 51% of equity in joint ventures to the local government or Indonesian private companies five years after production commences.
Indonesia’s reputation as a foreign investment has worsened considerably this year, with a wave of resource nationalism leading the government to forcibly seize majority stakes in mining sector joint ventures.
2 Comments
Farai
The practicalities of it are: How sure can an investor be that the government after 2014 will not view things in the same manner? Resource nationalism is currently in vogue. If then they intend to change things, then surely there will be a time lag to reckon with.
john
that might be true. but by 2014 their reputation as a phairah of mining will lead them to get hurt ,because they will not attract any more investments. apparently they donnot care much. they let the miners to come in promising good relations , and then they ambush them with new rules and regulations. this is wicked