Indonesia braces for impact of mineral export ban
By Rieka Rahadiana and Randy Fabi
JAKARTA (Reuters) - Indonesia's government was scrambling to pass last-minute regulations to limit the impact of a controversial ban that could halt billions of dollars worth of unprocessed mineral ore exports from Sunday.
The Southeast Asian nation is the world's biggest exporter of nickel ore, refined tin and thermal coal and home to the fifth largest copper mine and top gold mine. Mineral shipments totaled $10.4 billion in 2012, or around 5 percent of Indonesia's total exports, according to the World Bank.
The ban aims to boost Indonesia's long-term returns from its mineral wealth, but officials fear a short-term cut in foreign revenue could widen the current account deficit, which has undermined investor confidence and battered the rupiah currency.
Despite having more than five years to prepare for the mining law, officials just days ahead of the ban were rushing to try to soften the potential blow of the new policies.
"The government of Indonesia will still implement the mining law consistently. But we also want to make sure its effect won't be too troublesome and lead to the laying off of workers," said Susilo Siswoutomo, vice minister of the energy and mines ministry.
Mining companies, such as Freeport McMoRan Copper & Gold (FCX.N: Quote), have been ramping up shipments ahead of Sunday's deadline, uncertain whether they will be able to continue after that.
"We are still on to ship through January 11. Obviously, the only thing we will try is to maximize our shipments," said Daisy Primayanti, spokeswoman for Freeport Indonesia.
The mining ministry has approved regulations that would allow Freeport, Newmont Mining Corp (NEM.N: Quote) and others to continue to ship copper, manganese, lead, zinc and iron ore concentrate until 2017. Continued...