The Australian January 10, 2011 12:00AMRobin BrombyAFRICA was...

The Australian January 10, 2011 12:00AM
Robin Bromby


AFRICA was undoubtedly the mining investment story of 2010.

This year could be Indonesia's turn - or perhaps that will be 2013 or 2014. But, as they say, it will happen.

Australian company involvement in our northern neighbor has left a very patchy record.

But the archipelago is rich in resources and, with the Chinese and others stitching up mining deals all over the world, explorers can no longer afford to be sniffy about any jurisdiction -- as evidenced by a number of companies now moving into Sudan.

Energy and mining generate about a quarter of Indonesia's GDP.

The Indonesia Mining Association, however, points out that the country ranks sixth in the world for mineral resources, but 46th in terms of attracting investment for the sector.

It is still a high-risk jurisdiction. No explorer can be entirely sure that the playing rules won't be changed in the future, or that troubles won't erupt with local communities.

Yet banks are showing increasing willingness to finance projects in Indonesia.

The country has also applied to be included in the Norway-based extractive industries transparency index -- a sign that governance is being taken seriously.