The struggle over land and natural resource rights is a key aspect of the conflict in Papua, formerly known as Irian Jaya, that pits the Indonesian state against an independence movement supported by most of the indigenous population. It is thought to have cost many thousands of lives since the 1960s, mostly Papuan civilians killed by the security forces. Among the most recent victims were three employees of the giant mining company, PT Freeport Indonesia, killed in a well-planned attack on 31 August 2002.

The conflict is characterised by sporadic violent clashes between security forces and scattered guerrillas of the Free Papua Movement (OPM) and by the largely peaceful independence campaign of the Presidium of the Papuan Council, an umbrella group regarded, in a society of great ethnic and linguistic diversity, as the most influential voice of indigenous aspirations. Its starting point is the view that Indonesia’s 1969 annexation was not legitimate in the eyes of most Papuans.

The murder of Presidium chairman Theys Eluay by Indonesian soldiers in November 2001 has sparked fears within Papua of an impending crackdown on the independence movement, though another theory rests on alleged rivalry between retired generals over logging. There are fears that the presence of Laskar Jihad, a radical Islamic organisation with a history of communal violence, could exacerbate deep tensions between indigenous Papuans and the many Indonesian settlers. It seems likely that the conflict could escalate, especially if the military adopts the hardline approach it takes in Aceh.

Indonesia has attempted to end the conflict by offering special autonomy to Papua, as in Aceh. The original draft of the law, created by members of Papua’s educated elite, was watered down in Jakarta to produce a document short of the aspirations of even the most conciliatory Papuans. It does offer some potentially important concessions, notably returning more natural resource wealth to the province and giving a greater (but limited) role to Papuan adat (customary law). However, implementation has been left to an inefficient, sometimes corrupt bureaucracy, and most Papuans appear to reject it on principle. The success of special autonomy is, therefore, open to question.

Injustices in the management of natural resources under Indonesian rule have contributed significantly to the conflict. The state has often given concessions to resource companies in disregard of the customary rights of indigenous Papuan communities, while troops and police guarding these concessions have frequently committed murders and other human rights abuses against civilians. Provisions in the special autonomy law require resource companies to pay greater heed to adat claims to land ownership, but they do not apply retroactively to the many companies already in Papua.

Indonesian security forces have a financial interest in resource extraction in Papua, through direct involvement in logging and other activities and protection fees paid by resource companies. Numerous serving and retired officers, senior state officials and others close to government are thought to have logging concessions or other business interests. Alongside the substantial tax and royalties accrued by the state, these interests are a powerful reason for the Indonesian state and its agencies to keep control of Papua.

The resource industry with the widest geographical impact in Papua is the logging industry, whose concessions cover nearly a third of the province. ICG research in Papua, notably the western Sorong region, suggests widespread abuses by logging companies which exploit and deceive local people, pay little or no heed to environmental sustainability and rely on the military and police to intimidate villagers who protest.

It seems that many Papuans are not opposed to logging or other resource extraction in itself, but resent the way that they are often treated by companies. These tensions, fused with the independence struggle, have led to bloodshed in some places.

As in other parts of Indonesia, autonomy has led to a shift within the logging industry. Jakarta’s dominance over logging concessions has been challenged since 1998 by local timber elites who use new regulations to issue many small-scale licenses, ostensibly to benefit local people but usually to the profit of timber companies from Indonesia or other Asian countries. The members of these elites can include civil servants, military and police officers and Papuan community leaders. There has also been an upsurge in illegal logging in western Papua, apparently organised or facilitated by these same local elites.

The other resource industry covered by this report is mining. The Freeport copper and gold mine is the most controversial foreign mining operation in Indonesia, largely because of historical entanglement with Soeharto-era elites and military. The mine has long been accused of dispossessing locals and colluding in human rights abuses by its military guards. It has made increasing efforts since the 1990s to win legitimacy with a Papuan community swelled by immigrants drawn to the mine. These include much development spending but have themselves caused social disruption. Relations remain problematic between the company, its guards and an ethnically diverse community.

A new investment in natural gas, Tangguh LNG, is an attempt to extract natural resources without the conflicts associated with Freeport and the logging industry. The driving force, the multinational BP, has made significant efforts to win local support. This is highly complex because of the numerous, sometimes clashing interests involved, which include the company, the Indonesian state and its oil company, Pertamina, local and regional government, local communities, non-governmental organisations and security forces.

It is too early to say if BP will succeed, or even to define success. The project is seen as a test for a more humane approach to resource extraction. A significant risk is that security forces will try to involve themselves closely in Tangguh LNG, creating potential for human rights abuses and criminality that have afflicted other resource projects.

Should it succeed, BP’s approach will be a step forward. Nonetheless, the violent conflict seems likely to continue for some time. The onus should be on resource companies, Indonesian and foreign, to demonstrate that their presence will not make a bad situation worse. Promises of community development will not compensate if locals do not feel they have meaningful influence over companies, if inevitable social and environmental disruption is not well-managed and if the security forces role cannot be curtailed.

Special autonomy offers provincial government opportunity to create better oversight of resource companies, for example through independent commissions to vet investments and investigate complaints. The regulatory and licensing regime for logging should be overhauled to make it more just and sustainable, possibly including a commercial logging ban until reform has taken place. But the generally poor record of resource investment in Papua will not improve until two interlinked and very difficult issues are tackled: the needs to give meaningful autonomy and a greater sense of justice to indigenous Papuans, and to tackle the behaviour and finances of the Indonesian security forces.

Jakarta/Brussels, 13 September 2002