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...provincial capital, Manado. He has yet to overturn one shovel of ore. A half-built processing plant sits idly alongside a dirt track. Among the only signs of activity to be spotted are in the picturesque bay nearby, where fishermen paddle wooden canoes. The mine's operator, Perth-based Archipelago Resources, has faced delays because of a political battle that has raged from the villages outside the mine's gate to the ministries of the Indonesian capital of Jakarta. So Morrison, the project's chief operating officer, waits with as much patience as he can muster. "It is literally...

Author: /time Magazine | Title: What's Holding Indonesia Back? | 9/11/2008 | See Source »

...Channeling Chávez There are limits to what any elected President can accomplish in the diverse and far-flung island nation. To many Indonesians, the wrangling over economic policy is a sign of a healthy democracy. Sarundajang, the North Sulawesi governor, points out that the original contract allowing Archipelago to dig for gold in his province was signed in 1986, during the Suharto years, when citizens' wishes were disregarded. The struggle against the mine, he contends, is a struggle to correct the sins of the past. By opposing the mine, he says he wants to "give a salute...

Author: /time Magazine | Title: What's Holding Indonesia Back? | 9/11/2008 | See Source »

...China and India. But its economic-development policies are vague and scattershot; a devolution of political power from the central government to the provinces has created an unpredictable business environment rife with corruption, competing interests and confusing regulations. This not only thwarts the plans of would-be investors like Archipelago Resources but also tends to hold back ordinary Indonesians, who can do little but look with envy upon the upwardly mobile residents of Beijing and Bangalore. The percentage of Indonesia's population living below the poverty line in 1996 was 17.1%, according to the government. There was little improvement...

Author: /time Magazine | Title: What's Holding Indonesia Back? | 9/11/2008 | See Source »

...Indonesia's failure to launch can be seen as all the more frustrating because the country appears to be missing out on an epic global commodities boom. The archipelago of 17,500 islands is rich in natural gas, copper, coal, gold and other sought-after resources. Yet while some sectors, like palm oil, have seen exports surge, others have stagnated despite soaring commodity prices. A dearth of investment combined with aging fields has reduced the country's once formidable oil industry to near insignificance. Production has plummeted by one third in the past eight years. There may be undiscovered...

Author: /time Magazine | Title: What's Holding Indonesia Back? | 9/11/2008 | See Source »

...Indonesians these days are definitely making themselves heard, even in the thatch-hut hamlets surrounding the Archipelago mine. Some in the community, like village headman Marten Katiandagho, believe that preserving the environment is all well and good, but that the area also badly needs the jobs and the tax dollars the mine will bring. "People need to eat," he says. But other villagers have battled Archipelago ferociously, even forming their own NGO, called the Alliance of People Against Mining Waste, to stage protests and lobby in Jakarta. Says Tajudin Hema, one of the leaders of the antimine group...

Author: /time Magazine | Title: What's Holding Indonesia Back? | 9/11/2008 | See Source »

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