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xecutives are telling officials at the Finance Ministry to avoid issuing regulations that may hurt investment and to accelerate state spending on capital expenditures.

The comments were made at a rare coordination meeting between the ministry and members of the Indonesian Chambers of Commerce and Industry (Kadin) from across the archipelago assembled at Kadin’s offices on Monday.

Tugiyo Wiratmodjo, the chairman of Kadin’s Central Kalimantan chapter, claimed that a new 20 percent tax on metal ore exports and the government’s plan to ban unprocessed mineral exports, including coal exports, by 2014 would endanger the mining industry.

The tax, which came into force on May 6, was introduced to promote development of domestic value-added industries and to curb resource over-exploitation ahead of the ban’s implementation, which was stipulated by the 2009 Mineral and Coal Mining Law.

“Some of the stipulations in the regulation literally make it difficult for us to do business,” Tugiyo said, referring to a provision that demanded that firms develop 99 percent of the final added value of mineral exports domestically.

The government was not aware that almost 80 percent of the minerals traded globally had up to 65 percent of their final value added after initial processing, according to Tugiyo said.

“The government should know that all minerals are not the same … This regulation effectively hinders mining companies from doing business,” he added.

He proposed that the government invite executives to discuss policies before their promulgation to ensure effective implementation.

Criticism of the added-value policy has also been voiced by Japan, one of the nation’s largest trading partners, which recently threatened to terminate its paper imports if Indonesia maintained its metal ore export tax policy.

Japan previously said it would file a complaint with the World Trade Organization (WTO) on the policy.

Other Kadin members at the meeting voiced similar sentiments, agreeing that the central government’s added-value policy might hamper investments plans already in the pipeline.

The government’s inability to defuse or prevent strikes might also hinder investment, the executives agreed, calling on officials to exert “influence” on labor unions and workers to make cost valuations more predictable.

The Indonesian Employers Association (Apindo), for example, sued the West Java and Banten provincial governments for raising the minimum wage above a previously agreed to level. Apindo lost its battle after thousands of workers staged rallies that included blockades of toll roads.

Kadin members also urged the faster disbursement of government money. Gunadi Sindhuwinata, chairman of the Indonesian Motorcycle Industry Association (AISI) said, the faster expenditures were needed to improve the nation’s transportation infrastructure.

Gunadi said that the government had to change its annual habit of accelerating infrastructure spending in the final quarter of a fiscal year and should be more serious in disbursing capital in the first quarter.

According to the Finance Ministry’s budget agency, the government has spent only 18.2 percent of the Rp 168.7 trillion (US$17.8 brillion) wit has allocated for capital spending allocation in 2012 as of June. Deputy Finance Minister Anny Ratnawati said that the government appreciated the input and would arrange meetings every three months with the executives to discuss its policies.

Meanwhile, Bambang Brodjonegoro, the interim chief of the Finance Ministry’s fiscal agency, said that he also agreed with the executives’ request for faster disbursement for infrastructure development projects.

However, Bambang said that disbursements could only be accelerated if Kadin members used their political influence to support government plans to reduce fuel subsidies.

“The only way we can add more money for capital and infrastructure spending is by reallocating our subsidy budget. You, sir, have political connections that you can use to help the government in reallocating the subsidy budget,” Bambang said.

Earlier this year, the government failed to win the backing of the House of Representatives for its plan to raise subsidized fuel prices by Rp 2,000 to Rp 6,500 a liter, following massive demonstrations in Jakarta.