Jan 21, 2018 Last Updated 3:31 AM, Jan 6, 2018

Revisiting Inco

Published: Sep 11, 2007

Kathryn Robinson

Freeport McMoRan mine in Irian Jaya has been the site of ongoing human rights abuses. Less well known is the next major mining project off the rank during the New Order: the Soroako nickel project in South Sulawesi. Exploration began in this region in the late 1960s, not long after the government had pacified a regional rebellion (Darul Islam), which had kept rural areas out of government control for 15 years. The people of Soroako had barely returned from their refugee camps on the other side of Lake Matano when the exploration teams arrived.

The people welcomed them, and the company officials who came in their wake when production started in 1978. Investment by the International Nickel Company (Inco) reached US$850 million, and at a hundred million pounds of nickel matte a year, its smelter was the world's largest. As the owners of the land, they assumed they would benefit from the mine.

Their hopes were not realised. In the manner common to New Order projects, the people were forced to relinquish their land without adequate compensation. The Soroakans had no choice but to give up their agricultural land. Yet the government thought of it as a land sale at market prices. It set aside about US$100,000 for a community of a thousand. The landowners resisted taking the money. With the help of the Legal Aid Institute (LBH) they struggled to have the amount increased. In the meantime, much of the money was stolen or given to false claimants by government officials. The company's contract of work, negotiated with the central government, meanwhile sent the main revenues to Jakarta.

Well-paying permanent jobs, with the best houses, health care and schooling, went mainly to outsiders. Soroakans blamed their own lack of education, and enthusiastically embraced schooling for their children. Many young men left the village to further their education. PT Inco initially limited access to its schools to company employees. The book I published in 1986 dealt with the early phase of the project. Its title, Stepchildren of progress, reflected a view expressed by the people. 'We are given the bones while others eat the meat', they told me.

The later years of the New Order saw a large number of new non-government organisations (NGOs), which now have more freedom to operate. In 1996, PT Inco negotiated an extension of its contract of work to the year 2025. In a new political climate, the company is expanding production in Soroako, and developing a new work site in Central Sulawesi at Bahudopi/ Bahomotefe.


I revisited Soroako in November 1998, and was interested in the effects of reformasi. Soroako is an affluent community. South Sulawesi's reliance on export crops cushioned it generally from the effects of the monetary crisis. Cocoa farmers received massive increases in rupiah returns, because world market prices are in dollars. The mining company and many of its contractors increased salaries paid in rupiah.

Soroako village nestles picturesquely on the shores of Lake Matano, looking across to the mountains of Central Sulawesi. It has many very fine houses, and hotels and restaurants. However, the tarred road stops at the edge of the village. The company has devolved many activities to local contractors, keeping only a small permanent work force of about 2000. The prize of a permanent well-paying job is still elusive for Soroakans. Scores of young people now possess degrees, but it has not done them much good. A company magazine I saw had a photo of 'second generation Inco employees', and only one was an indigenous Soroakan. Most locals work (if at all) for the local contractors, or else in the agricultural and informal sector. Young women have particular difficulty in getting work appropriate to their qualifications.

Women have a difficult time. Most jobs with the local contractors are for men. Several young women with college degrees were about to begin work helping an older woman in a canteen franchise. It beat staying at home earning nothing!

The wooden house where I lived in the 1970s had been demolished and replaced with an urban-style single storey brick house. But just a few doors away, the house of a farming family remained exactly as it had been: a simple unpainted wooden house, the doors and windows all shut because the owners were away at their distant farms. The landlocked village, limited in its possibility for expansion through the company's forced acquisition of land, had grown out into the lake. Kinsmen from a village across the lake had built a 'village on the water' to avoid impossibly high land prices. The north west end of the village abuts the company-owned golf course. In the era of reformasi, the company has allowed local farmers to cultivate land fringing the golf course. Inco are providing funds to farmers' groups in Soroako and two other locations. In Soroako, the members are mainly widows, with no other source of income. They grow vegetables for local sale.

Late last year the president of PT Inco was called before the regional parliament to answer questions about benefits for the province. This was at the same time as the governor of Irian Jaya was claiming more local access to Freeport revenues. Like people around the Freeport mine, the Soroakan people have recently asked to reopen the land negotiations. I had asked them last year if they intended to do this, but at that time they said they were 'not brave' because they remembered how the army had forced them to accept the inadequate amounts in the 1970s.

The expanding activities of Inco have attracted the attention of non-government organisations, something that was not possible in the 1970s. Their new activities in Central Sulawesi are also closely monitored by local NGOs. Whereas the protests of the Soroakans over issues such as the removal of their ancestors graves went unremarked in the world at large, there has been consistent press coverage of the disputes associated with the development in Bahudopi/ Bahomotefe, with a few encouraging results.

Kathryn Robinson (kmr@coombs.anu.edu.au) is an anthropologist at the Australian National University, Canberra.

Inside Indonesia 60: Oct-Dec 1999

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