President Jokowi’s Story When He Took Over Freeport in 2018
PT Freeport is now owned by Indonesia with a 51 percent share ownership. This means that Indonesia has full control over Freeport. In acquiring Freeport back, President Joko Widodo revealed a series of stories when he tried to take over in 2018.
Quoting kompas.com, President Joko Widodo said that Indonesia must take courage if it wants to carry out economic transformation. One of them is by stopping the export of raw materials and increasing the added value of mining products carried out by the government with the takeover of PT Freeport.
Jokowi said that when he was about to takeover, there was a lot of daunting information about the impact of the move. “When we wanted to take Freeport back, the majority of the information was frightening. Papua will be shaken, Papua will be released, America will be angry,” said Jokowi when giving a speech at the 7th Anniversary of the Indonesian Solidarity Party (PSI) in Jakarta, Wednesday (22/12/2021).
“We were working on it for three years. The ministers go forward, backward, forward, backward. Forward, I do that,” he said. Jokowi admitted that he was worried about the choice. This is because PT Freeport has been controlled by foreign parties for 41 years.
However, after Indonesia took over, no problems occurred. “It turned out that there was nothing. Even though we didn’t buy it with our money, we bought it with its money,” said Jokowi. The head of state said that it is doable if the government would release PT Freeport next year because the government has benefited greatly from the current takeover.
However, Jokowi will not take that option. He wants the Indonesian government to continue to determine the majority policy. Therefore, in the future there will be an increase in the industrial value of the mining materials produced. “In the past, I was told to build a smelter and kept shaking.
With 51 percent shares, now I have ordered to build a smelter in Gresik and it has started right away because we own it now,” he said. Freeport itself had been operating in Indonesia for more than 41 years, but Indonesia’s shares at that time were still very minimal, below 10%.
In fact, the purchase of Freeport shares did not utilize APBN or State-Owned Enterprises (BUMN) funds because, according to him, the money to buy Freeport shares will have returned in three years. It is known that Indonesia finally and officially controlled 51.2% of PT Freeport Indonesia’s shares on December 21, 2018.
The signing of documents and settlement of transactions worth US$ 3.85 billion or around Rp. 55.8 trillion marked this. Indonesia acquired PT Freeport Indonesia’s shares through the Mining BUMN Holding MIND ID or PT Inalum (Persero). Previously, RI only owned 9.36% stake in PT Freeport Indonesia.
Meanwhile, Freeport’s new copper smelter in the JIIPE Special Economic Zone, Gresik, East Java, has finally made progress with the groundbreaking of the smelter, which was also witnessed by Jokowi on October 12, 2021. For the construction of this smelter, Jokowi expressed his pride because this smelter is said to be the largest in the world.
“We received a report that the smelter that will be constructed will have a single line design, the largest in the world,” said Jokowi when giving a speech at the groundbreaking event. This new smelter can process 1.7 million tons of copper concentrate per year to 600 thousand tons of copper cathode per year. The smelter is targeted to operate in 2023-2024.