Indonesia Scraps Plan to Ease Its Ban on Mineral Ore Exports
Bloomberg Monday, September 7, 2015
Indonesia will keep its ban on mineral exports, after rejecting proposals that would have allowed some raw ore shipments from mining companies in the process of building smelters, said Energy and Mineral Resources Minister Sudirman Said at a briefing in Jakarta.
Exports of raw minerals, including nickel, copper ore and bauxite, were stopped in January 2014 until miners had built metal processing facilities in Indonesia.
While insisting on smelting capacity before exports can resume would allow the nation to capture more of the wealth from its trove of natural resources, it has also benefited neighboring countries. Indonesian miners have invested in Malaysia to extract bauxite, while the Philippines has emerged as the world’s biggest nickel supplier.
Earlier this month, the government was considering easing up on its proscription. Proposals included allowing exports from miners whose smelters are more than 30 percent complete.
“After reviewing the costs and benefits, including environmental and smuggling risks, we came to the conclusion that it’s better to maintain the policy,” according to Said. “We also want to appreciate the companies that with great efforts have followed the regulation by building the smelters.”
Indonesia has more than 80 smelters under construction. Of those, 25 are nearly finished, Said said, with another 16 between 11 percent and 30 percent complete.
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