Indonesia’s Indigenisation Drive
Indonesia has introduce a new policy change which will limit the foreign ownership of mines to 49%.
This is part of Indonesia’s drive to increase domestic investment in the sector. The government has given mines 10 years to regularise.
The same thing has been done in Zimbabwe where an Indigenisation and Economic Empowerment Act (IEEA) was came into effect in March 2010. It also limits foreign ownership in business.
While many will make reference to the fact that Indonesia has given 10 years for regularisation, we think dealing with a country with a quarter of a billion people is a lot more complex than handling one where there are just over 14 million people at the last count. Add to that the fact the issues faced by both countries while similar, are characterised by unique circumstances.
We congratulate the people of Indonesia on this new policy change and we wish them the best going forward. We strongly believe the indigenous people of a country must benefit the most from the resources o a country. The carrot that is called ‘foreign investment’ must not be used to disenfranchise the locals. While the locals must not be mollycodled, they must be given a chance to fail before being treated like inferiors.