Sofyan Djalil. (Antara/Wahyu Putro A.)

National Development Planning Minister Sofyan Djalil has called on giant gold and copper miner PT Freeport Indonesia to increase its procurement of goods and services from state-owned enterprises (BUMN) as well as from other domestic sources, rather than importing them from abroad.

"Freeport's local sourcing is already at more than 60 percent, but there is still room for it [to add more]," said Sofyan, who also heads the Natural Resources Management Team for Papua, on Tuesday as quoted by Antara news agency.

According to Sofyan, several BUMN, such as state-owned coal miner PT Bukit Asam, state-run steel giant PT Krakatau Steel and state-owned cement maker PT Semen Indonesia, would be encouraged to supply coal, steel and cement for Freeport.

"There are also other BUMN [that will cooperate with Freeport]. Basically they are ready," said Sofyan.

Sofyan also called on Freeport to increase its cooperation with local businesspeople in Papua.

According to a data from the Energy and Mineral Resources (ESDM) Ministry, Freeport's local sourcing has reached 70 percent for goods and 90 percent for services, but the role of BUMN was still low.

"Freeport's procurement of goods and services through BUMN is only Rp 165 million [US$11,400]," said ESDM Minister Sudirman Said.

In total, Freeport's expenditure reached $1.9 billion per year; around $1.4 billion is product procurement.

Sudirman said that cooperation between Freeport and local companies would be more sustainable if it was based on mutual benefits, not merely due to obligations to obey the government's regulations.

"The important thing here is for Freeport to provide the necessary specifications [of its required goods and services], so its needs can be met by BUMN or private companies," said Sudirman. (kes)(++++)

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