May 31, 2012 / 8:00 AM / 7 years ago

Protesters block Indonesia's main coal-carrying rivers

JAKARTA (Reuters) - Hundreds of Indonesians are using boats to block two rivers vital for shipping coal out of the country’s main producing region to pressure the government to increase their quota of subsidised vehicle fuel, a local official said on Thursday.

Indonesia is the world’s top exporter of thermal coal and the blockade of the Barito and Mahakam rivers, which transport at least 15 percent of the country’s output from resource-rich Kalimantan province, is the latest protest by Indonesians who feel disenfranchised by their country’s commodities boom.

“The blockade is simply a way to pressure the central government,” said Numsuan Madsun, a spokesman for West Kalimantan.

Regional governors recently went to Jakarta to ask government officials to increase the amount of subsidised fuel sent to Kalimantan, where motorists are queuing for hours for cheap fuel at petrol stations.

Rising commodity exports are contributing to strong economic growth in Indonesia and creating millionaires faster than anywhere else in the world, but inequality is also rising and workers have pushed for a greater share of the wealth through a series of violent protests and strikes in the past year.

The central government is restricting supplies of subsidised fuel, which costs just half the market rate, after a surge in oil prices threatens to widen its budget deficit.

The parliament rejected a government proposal to hike the subsidised fuel price in April.

Coal producers using the Mahakam river include Harum Energy (HRUM.JK), Bayan Resources (BYAN.JK), Indo Tambangraya Megah (ITMG.JK) and Singapore-listed Sakari Resources SAKR.SI.

Indonesia mainly produces low grade coal. Its top customers are China, India and South Korea.

Reporting by Fergus Jensen; Writing by Michael Taylor; Editing by Neil Chatterjee and Miral Fahmy

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