Corporate Diplomacy / Case Study / 2200 words / 12 HOURS

Case 5: Gold Mining in West Papua

Time Period: November 2016

Overview (taken from The Guardian): You are the head of community relations Indonesia at Freeport McMoRan which operates the enormous Grasberg mine, one of the biggest gold and the third largest copper mine in the world. The mine is Indonesia’s single biggest taxpayer, with reserves worth an estimated $100bn. A recent fact-finding mission (by the Brisbane Archdiocese’s Catholic Justice and Peace Commission) described a “slow-motion genocide” taking place in West Papua, warning that its indigenous population is at risk of becoming “an anthropological museum exhibit of a bygone culture”. Since the Suharto dictatorship annexed the region in a 1969 UN referendum largely seen as a fixed land grab, an estimated 500,000 West Papuans have been killed in their fight for self-rule. Decades of military and police oppression, kidnapping and torture have created a long-standing culture of fear. Local and foreign journalists are routinely banned, detained, beaten and forced to face trial on trumped- up charges. Undercover police regularly trail indigenous religious, social and political leaders. And children still in primary school have been jailed for taking part in demonstrations calling for independence from Indonesia. Today, indigenous tribes such as the Kamoro and the Amungme claim their communities have been racked with poverty, disease, oppression and environmental degradation since the mine began operations in 1973. Locals fear that the government’s controversial transmigration programme, which resettles Indonesians from high-density islands such as Java to low-population areas, is wiping out their population completely. Indigenous Melanesian Christians – they comprised 96% of the population in 1971 – now make up a 48% minority, with numbers expected to fall to 29% by 2020 if migration rates continue. Clashes between the indigenous Christians – and migrant Indonesian Muslims – have also resulted in riots, fires and injuries.

Furthermore, there have been severe health concerns related to the fact that freeport dumps as much as 200,000 tonnes of mine waste into the Aikwa delta system every day. Sexually transmitted diseases such as AIDS are prevalent among the local population, as much as 15 times higher than in broader Indonesia. Dutch human rights law firm Prakken D’Oliveira submitted a formal legal complaint against Indonesia to the UN Human Rights Council, accusing the government of “long-term, widespread and systematic human rights violations” and the “complete denial of the right to self-determination of the people of West-Papua”. Later this year, West Papua is expected to be granted full membership of the Melanesian Spearhood Group, an important sub-regional coalition of countries including Fiji, Vanuatu and Papua New Guinea. There are fears this measure might mean nationalization of your company by a new West Papuan State, or sanctions by major countries against Indonesia if they continue to deny the referendum of self-determination.

Link to original article: https://www.theguardian.com/global-development/2016/nov/02/100- bn-dollar-gold-mine-west-papuans-say-they-are-counting-the-cost-indonesia

Objectives:

-Repair Freeport’s image as an enabler of genocide

-Prevent either the nationalization of the company or the imposing of sanctions on Indonesia which would prevent operations

-Ensure a continuing positive relationship with the Indonesian government

Budget (aprox.): $40 million