Indonesian mining revenue could shift dramatically under a new state mandate demanding at least 70 percent of returns from all operational licenses, BigGo Finance reported on Sunday.
President Prabowo Subianto announced the policy target during a speech on November 14 to members of Muhammadiyah in Palu, Central Sulawesi, according to VOI.id. He instructed the state to secure a minimum of 70 percent of benefits from mining activities and opened the possibility of taking controlling stakes in mining assets where necessary.
“I give instructions to ministers, especially the Minister of Energy and Mineral Resources, all mining permits, all IUPs, starting from now, at least 70 percent must be enjoyed by the state. If necessary, take control of the shares,” said Prabowo, as reported by VOI.id.
The Presidential Office issued an immediate clarification following the speech. Officials specified that the targeted 70 percent applies strictly to revenue generated from the operation of mining licenses, rather than the overall revenue or corporate profit of mining companies.
BigGo Finance reported that the president emphasized Indonesia remains open to foreign investment, noting that investors’ capital must be returned first, but added that the profits must mainly belong to Indonesians.
“Because we need capital, he can put in capital, your investment will return, after that the profit must be the majority of the Indonesian people,” Prabowo told the audience, according to VOI.id.
The policy signal marks a sharp reversal from earlier government discussions. Deputy Minister of Energy Yuliot Tanjung previously discussed a gross-profit-sharing plan for the mineral and coal industry, but Energy Minister Bahlil Lahadalia announced in June that the proposal had been withdrawn after consultations with Prabowo.
VOI.id said that Prabowo tied the new instructions to Articles 33 and 34 of the 1945 Constitution, criticizing business actors for moving profits made from natural resource permits abroad.
The president also addressed export reporting practices, announcing a one-door export policy through a government-appointed institution to ensure accurate reporting of commodities sent overseas. He did not specify the implementation rules, monitoring mechanisms, or the exact commodities included in the new export policy.
Neither the Presidential Office nor the Ministry of Energy and Mineral Resources has published specific implementation rules or a timetable for the 70 percent revenue share, leaving open whether authorities will raise royalties, mandate state equity participation, or apply both measures across critical supply chain minerals like nickel, coal, copper, and tin.
