Is a U.S. Mining Company Funding a Violent Crackdown in Indonesia?

The police say they cannot afford to protect the mine without money from Freeport, which has reported a security team of 725 company guards and 3,000 government guards. "We cannot fully equip our members [assigned to guard Freeport] or provide patrol cars. But Freeport said they could and didn't mind," National Police spokesman Senior Commander Boy Rafly Amar told the Jakarta Globe, where I work as a copy editor and reporter.

Back when Freeport set up its Grasberg operations in the late 1980s and early 90s, soldiers received a wage below the poverty line. They were encouraged to pursue local business ventures to supplement their incomes, but some exploited the local population and engaged in illegal practices, such as panning gold from the Freeport area and promoting prostitution in nearby towns. "Such military activities would adversely impact [Freeport] employees and the surrounding community," said Prakash Sethi, head of the New York-based International Center for Corporate Accountability, who traveled to West Papua between 2002 and 2007 to conduct an audit of the Grasberg mine's operations at Freeport's request.

The project allowed Sethi and a team of experts a rare look into the mining facilities, as well as access to interviews with company workers, community members and management. "It is my interpretation that ... because the military did not have adequate facilities at the mine site, Freeport agreed to provide the military with 'largely' in-kind support in terms of housing and eating facilities," Sethi wrote in an e-mail, adding that his audit did not examine how the military used those funds. "At the same time, some funding was provided for 'miscellaneous expenses.'"

That interpretation seems to be supported by a statement in Freeport's filings with the U.S. Securities and Exchange Commission in 2010: "From the outset of PT Freeport Indonesia's operations, the government has looked to PT Freeport Indonesia to provide logistical and infrastructure support and assistance for these necessary services because of the limited resources of the Indonesian government and the remote location of and lack of development in Papua."

The Problem with Pocket Money

In April, Papua Police's chief of operations sent a letter to a local rights organization, the Commission for Missing Persons and Victims of Violence, which states that security allowances were not just "incidental and administrative," and that each police officer receives $140 in direct payments every month.

The National Police has since confirmed and defended Freeport's monthly allowances. "That's only Rp 40,000 [$4.42] a day. Even if they want to spend it, the nearest shop is two and a half hours down the mountain," police spokesman Boy Rafly Amar told the Jakarta Globe. Another police spokesman said police otherwise make only Rp 53,000 in a month, or $5.86.

It is unclear exactly how the payments are made, or how security forces use the funds. According to Sethi, Freeport used to give money to security commanders because lower-level officers lacked bank accounts, and then the commanders distributed the payments themselves. "The question was, how much was actually given to the soldiers and how much was kept by the commanders in the headquarters?" said Sethi. "I don't know, and I think the company doesn't know. If you ask the question, it would look like you're insulting the professionalism of the commanders."

In addition to creating a conflict of interest for officers during the labor strike, activists worry the money helps perpetuate human rights abuses in the region, as the police and military attempt to stamp out the separatist movement. Papua formally joined Indonesia in 1969 after 1,024 Papuans voted unanimously to relinquish their sovereignty during a UN referendum (though Papuans allege that the representatives, hand-picked by the Indonesian government, were held at gunpoint during the vote). As Papuans in the region continue to fight for independence, Human Rights Watch has accused security forces of engaging in a number of rights abuses, including extrajudicial killings and torture.

Police and military officers -- who rely on Freeport for funding and equipment -- say they would not be able to perform their security operations in the region without the American company's support. In that same vein, activists argue that without Freeport, these officers would not be able to suppress the rights and independence aspirations of the Papuans to the extent that they do now.

Presented by

Samantha Michaels, a recent graduate of Northwestern University's Medill School of Journalism, is beginning a fellowship at The Jakarta Globe. She has also written for Condé Nast Traveler and PoliticsDaily.com.

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