"I heard that there is a godfather in the nickel business. This is not healthy. Let us eradicate it at the roots," a House of Representatives' member MH Said Abdullah noted in a statement received in Jakarta, Saturday (Nov 30).
Abdullah explained that the special committee aimed to quell the mafia rampant in the trade system for nickel exports in Indonesia
The nickel business is currently in an unhealthy phase since it is monopolized by several entrepreneurs.
These big business persons pay tribute to the authorities whereas at the same time small nickel-based entrepreneurs were marginalized.
Hence, Abdullah urged the government to act decisively on the "mafia" that allegedly controlled the nickel trading system in Indonesia.
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He cautioned that the ban on nickel exports could potentially result in 26 under-construction smelters being abandoned. That is since smelter owners can gather funds from the sale of low-grade nickel ore.
"The government has until now not provided a financing solution for the construction of 26 smelters that are running and huge costs are incurred for their completion," he stated.
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He pointed out that such conditions can potentially strengthen the nickel mafia to play.
"This condition certainly kills the local entrepreneurs," he pointed out.
Abdullah noted that the nickel cartel surfaced after the issuance of Energy and Mineral Resources (ESDM) Ministry Regulation 25/2019 on the ban on nickel exports in 2022.
However, this regulation was annulled by the issuance of ESDM Regulation 11/2019 that stipulates this ban to come into effect in 2020.
The inconsistent approach creates legal uncertainty for business actors. This is since the new regulation necessitates businesses to amend their business plans, from the start of 2022 now to 2020.
Hence, Abdullah urged the Energy and Mineral Resources Ministry to revoke the ministerial regulation
"The regulation only benefits certain parties, specifically large companies," he added.
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