Prabowo Subianto Calls for 70% Control of Mining Profits by the State

In a recent address at the Muhammadiyah Tanwir and Milad event in Palu, President Prabowo Subianto declared that at least 70% of the profits from Indonesia's mining sector must be enjoyed by the state. He emphasized that all mining permits should reflect this requirement, and if necessary, the government should also take control of shares in mining companies.

Prabowo's directive comes amid concerns that foreign investors have long benefited disproportionately from Indonesia's natural resources, with profits often repatriated abroad without sufficient local economic benefit. He said that for years, wealth has been extracted by foreign investors without contributing to the Indonesian people, and that when they profit, the benefits are taken out of the country.

“Prabowo said that for years, wealth has been extracted by foreign investors without contributing to the Indonesian people.”Prabowo Subianto, President of Indonesia

The president instructed Minister of Energy and Mineral Resources Bahlil Lahadalia to ensure that all mining licenses, known as Izin Usaha Pertambangan (IUP), comply with this new directive. Prabowo noted that if investors wish to enter, they can, but after they recover their investment, the majority of profits must belong to the Indonesian people. This approach aims to rectify what he describes as a long-standing imbalance in the management of the country’s wealth.

“He emphasized that if exports are reported as 100 tons, the report must reflect that actual amount.”Prabowo Subianto, President of Indonesia

Additionally, Prabowo announced measures to enhance oversight of the export of natural resources. He introduced a single-window export policy that mandates all export activities to be processed through a designated state agency. This policy is intended to prevent discrepancies in export reporting, which has historically allowed for manipulation. He emphasized that if exports are reported as 100 tons, the report must reflect that actual amount.

Prabowo stated his determination to continue his mandate to rectify the economic system in accordance with the principles outlined in Indonesia’s 1945 Constitution, specifically Articles 33 and 34, which advocate for state control over natural resources.