US company's investment helps Indonesia develop New Guinea

The praise for Indonesia's economic policy came from the United Sates Embassy in the Indonesian capital of Jakarta: "American business is finding a new sense of self-confidence among Indonesian economic policymakers and private business leaders with whom it deals," the report issued earlier this month said. "This comes from the widely evidenced prosperity in most sectors of the economy."

In the interior of Irian Jaya, as the Indonesians call their western half of New Guinea, the largest island in the world after Greenland, the self-confidence is manifest.

Freeport Indonesia, a subsidiary of Freeport Minerals, a Fortune 500 company, has invested upward of $300 million in a copper mining operation here that is a model of Indonesian- American economic collaboration. Freeport is weighing other investments which may eventually total another $50 million.

Since 1972 Freeport has mined 20 million tons of ore from which it has extracted 1.5 million tons of copper. Most of it is of extraordinary high grade , in the 2.6 percent rage with surges of double that percentage.

Visitors fly here in small helicopters, first across green mangrove swamps, then rain forests followed by dark, jungle-clad, serrated ridges leading to jagged black peaks. Ghostly mists encircle the peaks, lined with waterfalls cascading onto the jungle floor below. The fantastic mountainscape is usually crowned by snow and ice -- four degrees south of the equator.

The Freeport Indonesia mining operation is regarded as one of the singular engineering triumphs of the century. In a 5,000-square-mile area there are about 15,000 Irianese and only one road. Freeport's 68-mile single lane track runs along the crest of the ridges at grades periodically inclining to an incredible 27 degrees. So formidable is the terrain that the road leads nowhere.

The road's southern tip stops short 11 miles from the coast. The northern end of the road also stops abruptly, leaving a one mile abyss between road and mine atop the Ertsberg or, Ore Mountain, (Gunung Bidjih in Indonesian). The gap is a jungle-encrusted, impassable chasm.

Using a fleet of helicopters, Freeport solved the problem by erecting a "ski lift" across the gorge. The lift is the longest single suspension cable ride in the world. Men and ore are transported by cable in Swiss-built cars and hoppers , and operation unique in the history of mining.

From an Indonesian socio-economic standpoint, there are pluses to the operation that transcend corporate taxes. The operation is the most intensive, massive, on-the-spot managerial and technical school in the country. Freeport is force- gion that is a throwback to the neolithic period. The Damal, or Irainese, living around the mine site use stone implements and carry bows and arrows.

For a country strung along the southern rim of troubled Southeast Asia for 3, 000 miles, the Freeport Indonesia operation is also playing a major strategic role. Freeport has built and maintains a deepwater port at Amamapare; an international airport at Timika; a town of 3,600 at Tembagapura which boasts school, post office, hospital, sewage system, library, and, of course, machine shops, power plants, and repair shops.

The soft-spoken, newly installed governor of the province, General Boesiri, says he has "lofty mission" to lift the Irianese, a bright and alert people, into the present century. "This province has a big future," he said with confidence.

For TEmbagapura, the future is now.

There is great unity in diversity here with Indonesian workers from Bali, Sumatra, Java, Borneo, Celebes, Biak and, naturally, Irian. All administrative and skilled and unskilled labor are Indonesian; so are 71 percent of all technicians; 95 percent of all professionals; and 64 percent of management.

The only way to visit the area is by invitation (the province is closed to foreigners and tourists except for Jayapura, the capital and Gen. Douglas MacArthur's World War II headquarters).

Freeport went into Indonesia in 1966, shortly after the collapse of the communist-orientated Sukarno regime, when no other investor had confidence in the country's future. It is the first major investment of the present Suharto administration, and thus Freeport's continued success is widely viewed as a weathervane. Many feel it is an indication of which way the Jakarta wind is blowing on foreign investment, on questions of taxation, labor relations, and economic development.