Indonesia Expected to Announce EITI Plans
Indonesia will likely soon announce their intention to implement the Extractive Industries Transparency Initiative (EITI), beginning with a presidential decree about revenue reporting. A translated report from Jakarta has more information:
July 13, 2009, Jakarta, Kompas – The government of Indonesia is reportedly preparing to issue a Presidential Regulation, "Implementation of Transparency in State and Regional Revenue from the Extractive Industries," that will control how state revenue from the mining sector is reported.
M. Husen, the chair of Perpres, the Technical Team of the Preparation of the Presidential Regulation, explained on July 12 that the draft decree was created by an inter-departmental team composed of the Departments of Finance, Energy and Mineral Resources, and the Interior, all working under the Economic Coordinating Minister's Office.
Husen, who is also at the head of preparation efforts for EITI-Indonesia, said that the draft of the regulation had been submitted for approval to the Minister of Energy and Mineral Resources three weeks earlier.
The draft decree was compiled in accordance with Law Number 14 of 2008, which relates to the Openness of Public Information. It is anticipated that the Regulation will become effective on January 1, 2010.
The EITI is an ongoing international effort in numerous countries. Under the EITI, companies report payments to the state related to their natural resource extraction activities, and the state also discloses the revenues it receives from the companies. If there are discrepancies, they can be considered an indication of possible irregularities.
Indonesia's mining and mineral sector accounted for 32 percent of state revenue last year. However, the general public often questions these numbers. Several previous findings of the Financial Audit Agency have raised suspicions, including state costs for oil and gas, and the Tax Directorate General recently indicated suspicions of tax evasion by a coal company.
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