* Around $500 million of mineral exports have ground to a
* Investors concerned over impact on Indonesia's deficit
* Three smelters likely to be completed this year
By Fergus Jensen
NUSA DUA, Indonesia, Feb 17 Indonesia does not
expect to approve any export permits for mineral concentrates
until next month at the earliest, a senior government official
said on Monday, keeping one of the world's biggest mining
industries at a standstill.
Around $500 million worth of copper concentrate, nickel ore,
iron ore, bauxite and other mineral exports have ground to a
halt due to confusion over the implementation of Indonesia's
controversial mineral export ban on Jan. 12.
There are concerns a prolonged halt in mineral ore and
concentrate exports could cause the current account deficit to
blow out again, after narrowing to 1.98 percent of gross
domestic product in the fourth quarter.
The G20 economy is among the most vulnerable to the risk of
outflows due to its current account deficit, which hit a record
of 4.4 percent of GDP in the second quarter of 2013.
"Hopefully this March we will be ready to issue export
recommendations," Hersonyo Prio Wibowo, deputy director for
mineral production supervision said in a text message. "Six
companies have now applied for recommendation letters."
In order to export, mineral exporters must first receive a
recommendation letter from the mines ministry, and then apply to
the trade ministry to become a registered exporter.
President Susilo Bambang Yudhoyono last month imposed the
new mining rules, including the mining ban and progressive
export taxes on concentrates, aimed at forcing miners to build
smelters and process their raw materials in Indonesia.
Freeport McMoRan Copper & Gold and fellow miner
Newmont Mining, which together account for virtually
all copper mining in Indonesia and have been locked in talks
with the government over the implementation of the export tax.
Wibowo said the government would not approve export permits
until after it completes its review of data on planned smelters.
The Investment Coordinating Board expects three smelters to
be completed this year, one chemical-grade alumina smelter and
two sponge-iron producing facilities.