Indonesia’s Rising Nationalism and Escalating Resource Conflict

Updated On: Mar 31, 2006

In the book Resource Wars, written by expert on resources wars, Michael Klare noted that then British Defense Secretary John Reid argued that “dwindling natural resources are combining to increase the likelihood of violent conflict over land, water and energy” and “scarce resources, clean water, viable agricultural land even scarcer" -- and this will "make the emergence of violent conflict more rather than less likely”.

Indonesia seems to be on its way to some volatile resource conflict fueled also by rising nationalism. 

The recent Papua clashes have seen student protestors pitted against government forces. The students have been joined by legal experts who have slammed the government for not taking legal action against PT Freeport Indonesia over its alleged violations of the country's environmental laws. State Minister for the Environment Rachmat Witoelar said Freeport's Grasberg mine in Papua had violated environmental standards on acid drainage and tailings disposal.

But the incident is not so straightforward. The mines are owned by American investors and they account for a huge chunk of the region’s economy. Activists speculated the government was worried a legal dispute with the firm would stop work at the mine, depriving the state of revenue, and might only be settled through international arbitration. And, there is a fear that resource conflicts could spread and proliferate.

Police have also arrested a dozen people suspected of setting fire to the camp owned by U.S.-based Newmont Mining Corp. in West Nusa Tenggara. The attack on the camp by about 50 villagers caused no injuries, but about 20 buildings were burned down. The assailants were demanding Rp 10 billion (US$1.1 million) in compensation for community development from Denver-based Newmont -- one of the world's largest gold mining companies. The series of violent protests targeting American companies operating in Indonesia has recently raised concern about security for foreign investment.

Recently, President Susilo Bambang Yudhoyono (SBY) was also under fire for giving ExxonMobil managerial control over Java’s Cepu oilfield.

As John McBeth, a journalist based in Jakarta pointed out, the common denominator in all these three cases has been the United States

While the US has always been a favourite target of many Indonesians because of the war in Iraq and its Middle East policy, rising nationalism and the fear of the loss over control of its most precious resources fueled the recent debates and tensions.  Political groups have been quick to seize on these issues to stoke up anti-American, anti-West sentiments, and gain political capital.  SBY hence need to tread a fine line between appeasing foreign investors and nationalist sentiments.  Not the most easy job, since Indonesia needs foreign investments to fuel the economy and provide jobs for the millions of young Indonesians that enter the job market every year. Yet, nationalist sentiments cannot be ignored and would be used by his political opponents to undermine him. 


Indonesia and the New Human Right Council (Jakarta Post (JP), 27 March 2006)

Govt rebuked for not suing Freeport (JP, 28 March 2006)

Police arrest 12 suspects over attack on Newmont mining camp (AP, 29 March 2006)

Protests will not affect foreign investments (JP, 29 Mar 2006)

John McBeth “Nationalism takes centre stage” (Straits Times, 30 March 2006)

The Coming Resource Wars By Michael Klare (http://www.globalpolicy.org/security/natres/generaldebate/2006/0311resource.htm, Global Policy Forum, March 11, 2006)