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Jakarta Post

Editorial: Twist in Newmont divestment

  • The Jakarta Post

  /   Wed, August 1 2012   /  08:10 am

The State Investment Agency (PIP) will have to review its investment procedures and operations following the Constitutional Court’s decision on Tuesday that annulled the government purchase, through PIP, of a 7 percent stake in gold and copper mining PT Newmont Nusa Tenggara (NNT) in May last year.

The Constitutional Court’s verdict stipulates that since the PIP is simply a working unit within the Finance Ministry — unlike most other state companies with limited-liability corporation status — PIP investment plans must be detailed in the state budget and be approved by the House of Representatives.

Finance Minister Agus Martowardojo’s decision in May last year to take up the 7 percent stake in NNT, as the last tranche of NNT compulsory divestment to allow for controlling shareholders acting in the national interest, had been opposed as legally flawed by House membe...