Indonesia To Attract $11 Billion In Investments If Mining Law Is Approved

Jakarta, Indonesia (AHN) - Indonesia can attract as much as $11 billion in mining investments for 2008, if the mining bill becomes a law, said Priyo Abadi Soemarno, executive director of the Indonesia Mining Association.

Initiated in 2001, the Indonesian legislature enacted Law 19/2004, allowing 13 companies to resume open-pit mining in protected forests, but is still undergoing final review by the Constitutional Court.

His new estimate is several times higher than initial projections of $1.5 billion mining funds for 2007 and $900 million in 2006. Soemarno explained the higher estimates to higher global demand for minerals.

Indonesia's mineral resources include coal, copper, gold, nickel, oil and tin. A 2005 Asian Development Bank study said the country's mining sector employed 0.5 percent of Indonesia's labor and contributed 3 percent to its gross domestic product.

Foreign and local mining companies expected to plunk in money are Australia's Rio Tinto with a potential $2 billion investment and local Aneka Tambang with $441,000 (4 billion rupiah).