The Philippines is losing billions of dollars in potential mining investments because of the policy stalemate plaguing the industry, according to an independent think tank.
Dindo Manhit, Stratbase ADR Institute president, said that while countries, such as Australia and Indonesia, have managed to develop their mineral endowments as a strategic pillar of their economies, the Philippine mining industry has become stagnant, following the issuance of Executive Order No. 79 and DENR Administrative Order No. 2017-10 on April 27, 2017 effectively banning open pit mining.
“Our ability to efficiently and sustainably harvest the country’s mineral wealth potential, estimated to be worth more than a trillion dollars, just sitting underground and basically untapped, has been mired in prolonged legal and regulatory challenges,” he said.
Manhit spoke during the Stratbase ADR Institute’s roundtable discussion on open pit mining ban organized in partnership with the Department of Environment and Natural Resources and the Philippine Business for Environmental Stewardship.
“To put in perspective just how much opportunity we are losing, a 2016 list of just 11 pending projects was estimated to total over US$23 billion in capital investments. Compare this to the official figures of the Bangko Sentral ng Pilipinas on our total foreign direct investment from January to November last year which totaled only US$9.06 billion,” Manhit said.
“Passing a new mining revenue law now pending in the Senate will resolve the impasse caused by EO 79 and will result in substantial revenue gains needed for President Rodrigo Duterte’s vision for economic and infrastructure development,” he added.
Carmelo Bayarcal, PBEST convenor, backed Manhit, saying “aligning policies to responsibly develop the country’s resource potential while strictly enforcing existing environmental regulations to harness our mineral resources should be a priority of the government.”
According to Manhit, DENR under the leadership of Secretary Roy Cimatu is on the right track for initiating continuous consultations with industry experts to understand the complex technical, social and environmental issues affecting all stakeholders that would “hopefully” result in a more enlightened, pragmatic and stable policy environment.
Gerard Brimo, Chamber of Mines of the Philippines chairman, said EO 79 imposing a ban on new mining applications and DAO 2017-10 made mining in the Philippines unattractive to investors.
Brimo identified three open pit projects—Tampakan copper project, King-king copper gold project, and Silangan copper and gold project—in Mindanao that are now on hold as a result of the ban.
He said the pending projects could bring to the government yearly revenues of P12 billion and a total of P1.5 billion to the local government unit in those areas.
Concurrently, the projects will boost industry contribution to exports to 9 percent and total contribution to gross domestic product to 1.5 percent, he said.