Minister Lahadalia Asks Freeport to Build a Smelter in Papua

Jakarta – Minister of Investment/Head of the Investment Coordinating Board (BKPM), Bahlil Lahadalia has asked Freeport Indonesia (PTFI) to build a smelter in Timika, Central Papua.

The minister said that the construction of the smelter and process of divesting Freeport shares are part of the government's downstream program, which is one of the investment strategies carried out by the state to create jobs in the future.

"The world is currently talking about green energy and green industry. Therefore, we must design it from now. So, our nation doesn't become a consumptive country," Minister Lahadalia said in a statement on Sunday (June 2).

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[Menteri Investasi/Kepala Badan Koordinasi Penanaman Modal (BKPM), Bahlil Lahadalia, dalam konferensi pers Realisasi Investasi Kuartal I-2024, Senin, 29 April 2024]

Photo :

• VIVA.co.id/Mohammad Yudha Prasetya

This request is in line with the government's plan to increase the number of Indonesian shares in PTFI to 61 percent by 2024 – firrst was only 51 percent.

Currently, the government is waiting for regulatory certainty to process the acquisition of 10 percent of PTFI shares.

In the same statement, the minister gave an example, Indonesia's nickel reserves reached 25 percent of the world's total nickel reserves, so the government decided to stop nickel ore export in 2019. The regulation succeeded in adding value to the Indonesian economy.

"Our export value for nickel was only US$3.3 billion in 2017. Once, we stop exporting raw materials, we build the industry, we build the factory in Indonesia (in 2023) the increase will be US$33.5 billion or around IDR 500 trillion,” the minister remarked.

Minister Lahadalia stated that many developed countries were unhappy with Indonesia's policy of banning nickle ore exports.

Even Indonesia was sued by the European Union at the World Trade Organization (WTO) regarding this policy.

"I still belive that there are some other countries that don't want Indonesia to be sovereign in managing its own wealth," Minister Lahadalia concluded.

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"Our export value for nickel was only US$3.3 billion in 2017. Once, we stop exporting raw materials, we build the industry, we build the factory in Indonesia (in 2023) the increase will be US$33.5 billion or around IDR 500 trillion,” the minister remarked.