| JAKARTA, March 12
JAKARTA, March 12 Indonesia's next president is
unlikely to make major changes to the country's controversial
mining rules, after major political parties backed an export ban
that has led miners to halt $6 billion in annual mineral
The broad political support will disappoint miners, like
Freeport-McMoRan Copper & Gold, Newmont Mining Corp
, that may have been hoping the tough new rules were only
temporary measures imposed by a lame duck administration.
Political parties representing presidential front runners
for the July election told Reuters they support the current
government's moves to ban mineral exports and tax concentrate
shipments, aimed at forcing miners to build smelters in
Freeport has cut copper output by 60 percent due to a
prolonged dispute over the export tax imposed by President
Susilo Bambang Yudhoyono, who is barred from running for a third
Opinion polls show Jakarta Governor Joko Widodo of the
Indonesian Democratic Party-Struggle (PDI-P) as the most popular
presidential pick. If he decides to run, his main competition
will likely be ex-general Prabowo Subianto of the Great
Indonesia Movement Party (Gerindra) and wealthy businessman
Aburizal Bakrie of the Golkar Party.
"Golkar will not alter (the export ban policy), instead we
will underline the importance of value-added (commodities),"
Harry Azhar Azis, a senior member of the Golkar Party's economic
team, told Reuters.
Gerindra said the president's handling of the new mining
rules had caused widespread investor confusion, but the
political party would not change the mining rules if its
candidate, Prabowo, wins the presidency.
"We want there to be a consistent message that tells people
like Freeport and Newmont to just do it (and build smelters).
There may be short term pain, but in the medium to long term it
will be better for the economy," Hashim Djojohadikusomo,
Prabowo's brother and a senior party member, told Reuters.
PDI-P also fully supported the new mining laws and would not
significantly revise them, said Hasto Kristianto, the party's
deputy secretary general.
Freeport, whose Indonesian unit runs the world's
fifth-largest copper mine, has refused to pay an escalating
export tax introduced on Jan. 12 as part of a package of new
mining rules, and has been in talks with the government on the
Maintaining the mineral ore export ban would provide legal
certainty for foreign mining firms, like Russia's United Company
Rusal, that are looking to expand into Indonesia and
invest billions of dollars on new smelters.
"If Indonesia sticks strictly to the rules, the investment
will come," said Maxim Sokov, first deputy CEO of En+, the
parent company of Rusal, which signed an MOU last month to
invest as much as $3 billion in smelters.