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A dream denied? Mining legislation and the Constitution in Indonesia

Author

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  • Kosim Gandataruna
  • Kirsty Haymon

Abstract

Indonesia is blessed with a wealth of natural resources. After wresting power from the Dutch, the leaders of the new republic adopted a constitution that required this national wealth to 'be controlled and utilised by the State for maximum prosperity of the people'. The dream of turning the country's abundant natural resources into a catalyst for socio-economic development was not pursued actively until 1967, when Soeharto's incoming New Order government introduced policies that supported a significant expansion of the mining industry. The combined effect of the Asian financial crisis and domestic political unrest in 1997-98 interrupted this process. It was anticipated that the introduction of a new mining law in 2009 would re-invigorate the sector. Based on an analysis of five significant elements of the new legislation, this article finds it is unlikely to result in a mining industry that provides maximum benefit to the Indonesian people.

Suggested Citation

  • Kosim Gandataruna & Kirsty Haymon, 2011. "A dream denied? Mining legislation and the Constitution in Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 47(2), pages 221-231.
    • Handle: RePEc:taf:bindes:v:47:y:2011:i:2:p:221-231
    DOI: 10.1080/00074918.2011.585951
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    References listed on IDEAS

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    1. Ian Coxhead, 2010. "Trade, Resources And Development: The Implications Of Asian Integration," EEPSEA Special and Technical Paper sp201007s1, Economy and Environment Program for Southeast Asia (EEPSEA), revised Jul 2010.
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    Cited by:

    1. Jason Allford & Moekti P. Soejachmoen, 2013. "Survey of recent developments," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 49(3), pages 267-288, December.
    2. Nurul Listiyani & M. Yasir Said & Afif Khalid, 2023. "Strengthening Reclamation Obligation through Mining Law Reform: Indonesian Experience," Resources, MDPI, vol. 12(5), pages 1-14, April.
    3. Glenn Banks, 2014. "Drilling and Digging: Extractives, Institutions and Development," Development and Change, International Institute of Social Studies, vol. 45(1), pages 191-204, January.
    4. van der Eng, Pierre, 2014. "Mining and Indonesia’s Economy: Institutions and Value Adding, 1870-2010," PRIMCED Discussion Paper Series 57, Institute of Economic Research, Hitotsubashi University.
    5. Kurniawan, Robi & Managi, Shunsuke, 2018. "Coal consumption, urbanization, and trade openness linkage in Indonesia," Energy Policy, Elsevier, vol. 121(C), pages 576-583.
    6. Dutu, Richard, 2016. "Challenges and policies in Indonesia's energy sector," Energy Policy, Elsevier, vol. 98(C), pages 513-519.
    7. Janet Xuanli Liao & Weibo Zhang, 2024. "The governance models vs. the development courses of the mining sector: cases of Indonesia and the Philippines," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 37(2), pages 279-295, June.

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