The Prabowo-Gibran Government Urged to Improve Governance and Mitigate Negative Impacts of the Nickel Downstream Industry in Indonesia

The Prabowo-Gibran Government Urged to Improve Governance and Mitigate Negative Impacts of the Nickel Downstream Industry in Indonesia

 

Palu/Jakarta, 18 October 2024 – The Indonesian National Critical Mineral Conference (KNMKI), held on 9-10 October, issued a joint statement urging all stakeholders in the critical minerals sector, particularly nickel, to prioritise Indigenous Peoples' rights and ensure sustainable environmental and social governance.

The statement, issued on the eve of the Prabowo-Gibran administration’s inauguration (20 October), called on the nickel industry to address growing evidence of its negative impact on the rights of Indigenous Peoples. Over 60 co-signatories, including civil society organisations, affected communities, and workers' unions in the nickel processing industry, requested that the government address the destructive impacts of the mining and critical minerals sector.

 

"We urge the new Prabowo-Gibran government to listen directly to the voices of affected peoples and take concrete steps in formulating inclusive and responsible policies. Nickel down streaming must not benefit only a few parties but also protect community rights and ensure environmental sustainability for the common good," added Linfa Rosalina, conference chairperson and Executive Director of TUK Indonesia.

 

Projection of Nickel Demand and Environmental Impacts Remain Unclear in National Planning

Planning for nickel demand in Indonesia is insufficiently detailed in key national documents like the National Long-Term and Medium-Term Development Plans (RPJPN and RPJMN). Despite rapid industry growth, environmental impacts, especially carbon emissions, receive little attention, to the detriment of critical ecosystems.

 

"Banks, as the lenders to companies, play a role as catalysts and accelerators of financing. However, reckless exploitation of nickel is causing environmental damage and social conflicts. Banks need to integrate responsible financing practices that support human rights and environmental preservation" said Herni Ramdlaningrum of the ResponsiBank Indonesia coalition.

 

Limited local government power and overlapping central and regional policies hinder effective oversight of the industry. The 2020 Coal and Mining Law and the 2022 Job Creation Law, which centralise operational permit authority at the national level, further restrict civil society’s ability to monitor developments, while clientelism at the heart of local government, centred on conflicts of interest, undermines the ability of Indigenous Peoples to uphold their rights.

 

"The nickel industry does play an important role in supporting the energy transition, but the rapid development of this sector must be balanced with serious attention to environmental and social impacts. The government needs to strengthen the governance of the nickel sector by increasing transparency, accountability, and coordination between agencies at both the national and regional levels. The active involvement of civil society in oversight must be ensured so that industrial activities are carried out more responsibly and effective remedy for affected communities can be achieved," said Meliana Lumbantoruan, Deputy Director of Publish What You Pay (PWYP) Indonesia.

"All stakeholders need to recognize that corrupt practices have contributed to environmental damage and marginalized local communities. The lack of commitment to providing decent livelihoods for workers is alarming. The development of downstream industries must align with the principles of humanity and social justice. Immediate action is needed before larger mistakes severely damage all aspects of life." emphasized Olisias Gultom, Director of the Sahita Institute (HINTS)

 

Neglected Social, Economic, and Employment Impacts

The rapid development of the nickel industry has led to the loss of essential livelihoods, such as fishing, while providing limited alternative job opportunities for nickel-affected communities. The enormous profits these companies earn are accompanied by the transfer of social and economic risks to local residents.

 

“Investment flows should not only provide facilities for companies to run their businesses but also have a multiplier effect, such as providing fair economic benefits, access to decent work, and improving the welfare of local communities,” said Herni Ramdlaningrum from the ResponsiBank Indonesia Coalition.

 

A rights-based approach cannot coexist with the militaristic and violent methods currently dominant in nickel industry areas.

 

“It is impossible for farmers, workers, or residents in mining and critical mineral processing areas to thrive as long as the government and business world continue to prioritize militarism and violence in resolving the issues that arise.” said Wasi Gede, Director of INKRISPENA. 

 

Strengthening Indigenous Peoples' rights is crucial amid the growing metal and mineral industries in Indonesia, particularly enhancing their understanding of the right to "Free, Prior, and Informed Consent" (FPIC).

 

“Indigenous peoples' and local communities' rights extend beyond mere land compensation. To be fully realized, these rights require a deep understanding of the reasons behind, the purposes of, and the consequences of critical mineral industry projects on their lives. Ultimately, they are the ones who are most affected—whether they have already been exploited, are currently being exploited, or will be in the future as part of this industry’s concessions.,” explained Rudiansyah, Yayasan Masyarakat Kehutanan Lestari (YMKL)

 

Thus, a joint effort between the government, communities, and all stakeholders is essential to ensure that community rights are protected and that they receive comprehensive information about the impact of the critical mineral industries on their environment and livelihoods.

Environmental Destruction, Biodiversity Loss, and Serious Health Threats

Instead of transitioning to clean energy, the government continues to approve the construction of captive (off-grid) coal-fired power plants in nickel industrial areas, which are a leading cause of climate change.

 

"The practice of critical mineral exploitation in Indonesia, which seems to know no bounds, clearly overlooks the crises we are currently facing. Indonesia and the rest of the world face climate, biodiversity, and pollution crises. These are all interconnected and transboundary and have long-term consequences. The Indonesian government must rethink its critical mineral exploitation strategy to avoid worsening these crises." said Ahmad Ashov Birry, Program Director of Trend Asia, 

 

Nickel mining activities have caused massive deforestation, severe water and air pollution, and the extinction of biodiversity that supports ecosystems. This environmental destruction threatens flora and fauna and exacerbates the risk of ecological disasters—such as floods, landslides, and soil degradation—that make the environment uninhabitable.

However, the worst impacts are felt directly by surrounding communities. Pollution has triggered a severe health crisis. Diseases like acute respiratory infections (ISPA), widespread skin diseases, eye irritation, and poor sanitation—worsening childhood stunting—are clear evidence. Public health is being sacrificed for industrial profit, while both central and local governments and companies turn a blind eye to the growing suffering.

 

“Dirty greenwashing practices are rampant in the nickel industry. Victims are falling every day. The environmentally friendly narrative pushed by the government for nickel investments contrasts starkly with the reality. In the field, we see no trace of good mining practices. The people are now facing a water crisis, respiratory diseases, floods, and landslides.” said Richard, Yayasan Tanah Merdeka (YTM) Director. 

 

 

Media Contact :

Annisa N. Fadhilah - Tuk Indonesia, 087884446640 

Arie Utami - Indonesia Cerah, 08111770920 

The Communiqué of Conference are here

Documentation of the Conference are here

Organizations and communities involved:

• Aksi Ekologi dan Emansipasi Rakyat (AEER)
• Pemberdayaan Perempuan Kepala Keluarga (PEKKA)
• Auriga Nusantara
• Perempuan Mahardhika
• Solidaritas Perempuan Kendari
• Perhimpunan Pembela Masyarakat Adat Nusantara (PPMAN)
• Solidaritas Perempuan Palu
• Pusat Penelitian Lingkungan Hidup (PPLH) Universitas Tadulako
• Solidaritas Perempuan Sintuwu Raya Poso
• PWYP Indonesia
• CNV Internationaal
• ResponsiBank Indonesia
• Djokosoetono Research Center (DRC) Fakultas Hukum Universitas Indonesia
• Sahita Institute - HINTS
• Fakawele Project
• Satya Bumi
• FIKEP-KSBSI
• SBIMI
• Ford Foundation
• Sekretariat Nasional Solidaritas Perempuan
• Forest Watch Indonesia (FWI)
• Solidar Suisse
• Forum Ambunu Bersatu (Morowali)
• SPIM
• FPBI
• SPIM-KPBI MOROWALI
• FPE
• SPN Morowali
• FSPMI
• Tara Climate Foundation
• ICW
• Tifa Foundation
• Indonesian Center for Environmental Law (ICEL)
• Transparency International Indonesia
• Institut Kajian Krisis dan Strategi Pembangunan Alternatif (Inkrispena)
• Trend Asia
• Institute for National and Democracy Studies (INDIES)
• TuK INDONESIA
• International NGO Forum on Indonesian Development (INFID)
• WALHI Maluku Utara
• Jaringan Advokasi Tambang (JATAM) Sulawesi Tengah
• WALHI Sulawesi Selatan
• Koalisi Perempuan Indonesia
• WALHI Sulawesi Tengah
• Koalisi Save Sagea
• WALHI Sulawesi Tenggara
• Konfederasi KASBI
• Yayasan Ambeua Helewo Ruru
• KPA Sulawesi Tengah
• Yayasan Indonesia CERAH
• LBH Makassar
• Yayasan Kompas Peduli Hutan (KOMIU)
• Lokataru Foundation
• Yayasan Masyarakat Kehutanan Lestari (YMKL)
• Masyarakat Desa Tompira
• Yayasan Merah Putih (YMP) Sulawesi Tengah
• Masyarakat Komunitas Torobulu
• Yayasan Pikul
• Nexus3 Foundation
• Yayasan Tanah Merdeka (YTM)
• Solidaritas Perempuan