The Mining Advocacy Network (Jatam) has accused Minister of Investment/Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia of fraudulent practices by setting tariffs or fees for mining companies seeking reinstatement of their rescinded licenses.
The polemics over the mining licensing began in May 2021, when President Joko “Jokowi” Widodo issued Presidential Decree No. 11/2021 on the Investment Acceleration Task Force.
“Through this Presidential Decree, Jokowi appointed Bahlil as Head of the Task Force with the main task of ensuring investment realization and resolving licensing issues. The decree also allows Bahlil to track unproductive mining and plantation permits,” Melky Nahar, Coordinator of JATAM, said in a discussion on Monday, March 18, 2024.
In January 2022, Jokowi issued Presidential Decree No. 1/2022 on Land Management and Investment Structuring Task Force. This decree mandated Bahlil to chair the Task Force, who tasks include revoking mining permits, business use rights, and forest area concessions as well as providing facilities for community organizations, cooperatives, and others to obtain land.
In October 2023, President Jokowi issued Presidential Regulation No. 70/2023 on Land Allocation for Investment Arrangement, which authorizes the Task Force led by Bahlil to also revoke mining permits, plantations, and forest concessions, as well as grant land utilization permits for mass organizations, cooperatives and others.
Along the way, the Task Force has revoked 1,118 Mining Business Licences (IUP) and 15 Forest Area Utilization Permits (IPPKH). These permits are part of the 2,078 IUPs, 192 Forestry Sector Permits (ISKs), and 34,448 hectares of abandoned plantation cultivation permits (HGUs) that President Jokowi announced in January 2022.
Bahlil Lahadalia is a politician with an entrepreneurial background. He develops business through PT Rifa Capital as a holding company that houses a number of companies, one of which is PT Bersama Papua Unggul. Bahlil controls 90 percent shares of PT Bersama Papua Unggul. One of the company’s business lines is in the mining sector, through PT Meta Mineral Pradana (MMP), a nickel mining company with two mining licenses in North Konawe, Southeast Sulawesi. PT MMP’s shares are owned by PT Bersama Papua Unggul (90 percent) and PT Rifa Capital (10 percent).
In running his business, Bahlil has a close associate Tresse Kainama, who is recorded to have a 10 percent stake in PT Bersama Papua Unggul. Tresse’s name also appears in a number of companies affiliated with Bahlil’s companies, namely PT Meta Mineral Pradana as Director, PT MAP Surveillances as Director, and PT Karya Bersama Mineral as Commissioner.
In addition to the above mining companies, Tresse Kainama is also listed as Commissioner of PT Cendrawasih Hijau Lestari and Commissioner of PT Cendrawasih Artha Teknologi. PT Cendrawasih Hijau Lestari is a company engaged in the forestry sector, operating in Kaimana, West Papua.
Another name associated with Bahlil is Setyo Mardanus, President Director and 5 percent shareholder of PT MAP Surveillances and Commissioner and 50 percent shareholder of PT Karya Bersama Mineral. Setyo is also known to serve as President Commissioner and 50 percent shareholder of PT Berkarya Bersama Halmahera, President Commissioner of PT Duta Halmahera Lestari, Commissioner of PT Tataran Media Sarana, and Commissioner of PT Kacci Purnama Indah. The latter company has been accused by the Southeast Sulawesi Mining Circle Network (JLP) of illegal mining in forest areas without securing IPPKH in North Konawe, Southeast Sulawesi in October 2022.
Another name known to be close to Bahlil is Made Suryadana. He is listed as Commissioner of PT Bersama Papua Unggul and PT Meta Mineral Pradana. Made is also the majority shareholder (85 percent) of PT Wirani Sons and the Commissioner and 25 percent shareholder of PT Ganda Nunsantara. In addition, he also serves as Director of PT Cendrawasih Artha Teknologi, a company that has worked on the installation of 2,300 kilometres of optical fibre in the Palapa Ring Papua project in 2017-2019.
Bahlil and Jokowi in the 2019 Election
Bahlil’s vast business network is inseparable from his closeness to President Jokowi, especially since the 2019 elections. Before being sworn in as Cabinet minister in October 2019, Bahlil’s close acquaintance began when the two met at the Indonesian Young Entrepreneurs Association (HIPMI) 16th National Conference in Jakarta on September 16, 2019.
During the 2019 election, Bahlil was known to have served as the Director of Young Voters Mobilisation for the Joko Widodo-Ma’ruf Amin Election Winning Team (TKN). Referring to the KPU report and the Jokowi-Ma’ruf TKN report, companies affiliated with Bahlil were recorded as contributors to the Jokowi-Ma’ruf pair’s campaign funds in 2019, respectively PT Cendrawasih Artha Teknologi for Rp 25 billion (US$1.6 million) and PT Tribashra Sukses Abadi for more than Rp 5 billion.
Bahlil’s affiliation with PT Cendrawasih Artha Teknologi can be seen through the composition of the company’s shareholding, where PT Rifa Capital is the majority shareholder (70 percent), the rest (30 percent) is owned by PT Procon Multi Media. Bahlil is also known to have held the position of Commissioner of PT Cendrawasih Artha Teknologi.
As for PT Tribashra Sukses Abadi, it is listed as the majority shareholder (90 percent) in PT MAP Surveillances. The remaining shares are owned by Wismantoro (5 percent) and Setyo Mardanus (5 percent) who also serves as President Director. PT Tribashra Sukses Abadi is also listed as owning 75 percent of PT Cendrawasih Hijau Lestari.
Political corruption and Bahlil’s vast business lines
The proximity and great political power given by Jokowi to Bahlil, and the business lines that are increasingly expanding, should be suspected to be inseparable from the practice of political corruption, said Melky of Jatam. He cited that in the context of the revocation of mining licenses, Bahlil is considered to be selective, even allegedly charging tariffs to a number of companies so that their licences can be reactivated.
These shady practices indicates strong political corruption allegedly committed by state officials in Indonesia. Political corruption occurs when political authorities use their authority to increase their wealth and maintain their power and status. The perpetrators of this corruption often design regulations and policies according to their interests, abuse and or ignore laws and regulations, to manipulate political institutions and procedures so as to influence the government and political system.
Jatam concludes in its reports that the main mode of political corruption is usually related to abuse of office, where relevant officials use their political power for personal or group interests. In addition to seeking personal and group benefits, the mode of political corruption is also carried out to reward groups or campaign funders.
Another main mode is corruption at the electoral moment, which Jatam calls as Ijon Politik. This practice can be understood as an intertwined system between corporations (financiers) as political funders to finance the candidate nomination and campaign expenditures in general elections. The financiers then receive rewards in the form of political positions and or legal and security facilities and guarantees for businesses.
In addition, the other main mode is corrupt practices in the policy-making process. Corruptors with their power and authority will win policy agendas that favor themselves and certain groups. This happens as a payback to the financiers who have helped alleviate political costs. Among the forms of corruption modes at the moment of policy making are the provision of Regional Budget (APBD) portions in government projects, winning tenders for the procurement of goods and services, ease of business licences, and regulations that benefit only some parties.
Jatam urges the Corruption Eradication Commission (KPK) to investigate the alleged corrupt practices, targeting Bahlil and those close to Bahlil himself.
On many occasion, Bahlil has denied the allegation. He said in a public statement on Monday, March 18, 2024 that he is in talk with the Investment Coordinating Bureau/Minister of Investment’s legal bureau to consider reporting those having denigrated him with law enforcement institutions. “It is a law violation, we will bring the case to law enforcement institutions so that there will be no lies between us,” Bahlil.
