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Miners ask Duterte to break impasse

Posted on August 25, 2016

INDUSTRY AND REGULATORY OFFICIALS yesterday held out hope that the country’s mining sector could regain traction in the next six years as miners weather a state crackdown on those deemed irresponsible among their ranks, setting a positive tone at the start of an annual summit.

Citing the need for policies to “be based on science and hard facts and not on mere slogans of hard-line ideology,” the Chamber of Mines of the Philippines (COMP) asked President Rodrigo R. Duterte “to immediately convene a meeting with the industry” to break “the wasteful impasse” the industry has had to endure since 2011.

The country’s miners have been reeling from the moratorium on new mining permits that has been in place since 2011 and extended indefinitely through Executive Order No. 79 signed by former President Benigno S. C. Aquino III on July 6, 2012. A new mining revenue-sharing scheme that was supposed to lift the moratorium was left untouched when the 16th Congress ended last June.

Miners had said before the May 9 elections that a new administration should bring new hope, but that was dashed with the appointment of a staunch environmentalist to the helm of the Department of Environment and Natural Resources (DENR) in the person of Regina Paz “Gina” L. Lopez, who launched last month a wide-ranging audit that has suspended 10 projects so far.

“The unstable policy regime of the last six or seven years had resulted in staggering loss of opportunity,” COMP President Benjamin Philip G. Romualdez said in his welcome address at the start of the Mining Philippines 2016 International Conference and Exhibition -- themed: “Realizing the Potentials of the Mining Industry in a New Regime” -- in Marriott Hotel Manila, Pasay City that ends today.

“Under the administration of former President Benigno Aquino III, no new mining agreements were issued, and the industry’s fiscal and regulatory regime came under very close scrutiny from the executive, legislative and judicial departments,” Mr. Romualdez added, recalling the “years of promotion during the administration of [former] President Gloria Macapagal-Arroyo” during which “the industry was already gaining momentum” to eventually contribute 5% to gross domestic product (GDP) and 10% to total exports “if only the mining industry was allowed to flourish.”

Official data on the Web site of the Mines and Geosciences Bureau (MGB) show that the industry’s gross production value slumped 47% to P109.2 billion last year from 2014’s 206.2 billion, with the value of large-scale metal mining alone dropping 22% to P108.4 billion from P139.1 billion.

This year could see a further drop, as gross production value hit just P22.1 billion in the first half.

Mining investments dropped 22.48% to $924.9 million last year from $1.193 billion in 2014.

Mining contributed 0.7% to GDP last semester and 0.6% for the entire 2015, 4.1% to total exports in the first half and 4.8% last year, as well as 0.5% to total employment as of June and 0.6% for the entire 2015.

The government exacted from the industry some P25.782 billion in taxes, fees and royalties last year, 21.28% less than 2014’s P32.751 billion. These levies totaled just P931.9 million last semester.

There were 40 operating metal mines across the country last semester -- consisting of 27 nickel, five gold with silver, four chromite, three copper with gold and silver, as well as one iron mine -- down from 44 last year.

Mr. Romualdez remained hopeful of better times ahead under Mr. Duterte, who took office last June 30.

“President Rody Duterte’s first words on mining were encouraging,” Mr. Romualdez said, recalling that the chief executive had said he was “not against large-scale mining” per se but against miners who “don’t do it making money out of the precious metals of the earth that belong to the Filipino people...”

Addressing newly appointed MGB Director Mario Luis J. Jacinto, Mr. Romualdez said: “We assure you that the Chamber of Mines will follow the law, and we will engage in responsible mining, using only the best practice available to ensure that our host communities and the environment will thrive under our care.”

“We are not afraid of the ongoing audit of the DENR,” Mr. Romualdez said.

“We welcome this purging of illegal and non-compliant mining operations.”

Then, as if addressing an unseen industry tormentor, Mr. Romualdez said: “But no one has a monopoly on the environment!”

“The strict enforcement of environmental regulations are already in our laws which the chamber strongly supported in Congress,” he said, referring to Republic Act No. 7942 or the Philippine Mining Act of 1995.

Mr. Romualdez noted that 17 out of COMP’s 21 members have already secured ISO 14001 certification for their environmental management systems -- “no mean feat, considering that we only had one year to comply with the regulation” to meet the requirement.

“I was assured... that the four remaining companies will secure their respective certifications shortly.”

Citing some $22 billion worth of capital investments lined up within the next five to 10 years -- including some which DENR chief Lopez had criticized and opposed -- Mr. Romualdez said the industry can help build “an industrialized Philippines at par with its ASEAN neighbors” where steel and other key industrial components are produced locally using Philippine minerals and metals.”

At the same time, he railed “the ongoing demolition campaign that is maliciously maligning the true nature of legitimate mining,” saying: “[W]e will not allow anyone to destroy our industry from within or without!”

“To break this wasteful impasse, we appeal to the President to immediately convene a meeting with the industry and the MICC for constructive consultations on how to put a balance to the complex issues of mining so that policies moving forward will be based on science and hard facts and not on mere slogans of hard-line ideology,” Mr. Romualdez said, referring to the Mining Industry Coordinating Council formed in the last administration to reform the sector.

In his own remarks, MGB chief Jacinto, who assumed office on Aug. 1, said the current audit of metal mines -- which will be followed by a similar check on non-metal mines and even coal plants that contribute a third and the biggest chunk of the country’s power supply -- will “be completed by the end of the month.”

Saying “[t]he strong environmental movement which started to gain momentum in the late ‘80s will always bear pressure on extractive industries,” Mr. Jacinto said: “The challenge is to squarely address legitimate concerns, provide proper information to have a shared perspective of development options and patiently reason with oppositors [sic] to set aside unreasonable demands.”

In his speech, Federation of Philippine Industries (FPI) Chairman Jesus L. Arranza said that “to keep the mining industry’s morale high -- especially at this time when it going through its most challenging moments -- I suggest that you should organize a dedicated group that will effectively monitor and police your own ranks,” citing FPI’s own “Fight Illicit Trade” campaign to curb smuggling and illicit trade among members.

Joey P. Leviste, Jr., chairman of OceanaGold Philippines, said in his own speech that the industry was “looking forward to a very exciting time and period in the country.”

“Can you say that we still have that optimism?” Mr. Leviste asked.

“Perhaps it might be early to speculate at the 58th day of the Duterte administration... there are still 2,135 days to go and I always believe in the saying that however good or bad the situation is, it will change.” -- with JCL

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