In the wake of a landslide that hit an illegal mining site in Itogon, Benguet, that killed 34 people and dozens more missing at the height of Typhoon Ompong, President Duterte said it is time for the Department of Environment and Natural Resources (DENR) to take a serious look on destructive mining practices. Duterte added: “Mining must stop. And if I cannot stop it during my time as President, nobody can. Because it’s big business and the pressure is just too great.”
We understand where the Chief Executive is coming from, as we can’t crucify the truth that destructive mining would “result in perdition for the country.” Sadly, mining’s bad reputation precedes the industry, thanks to a number of unscrupulous businessmen who had no regard for the public good. Thus, the DENR’s marching order to review the best practices in mining and use these as standards that existing and new entrants to the sector must adopt is a good starting point. It must not allow a repeat of the Itogon, Benguet, tragedy.
Closing all mining sites in the country, however, is not a practicable solution. The products of mining are very much a part of our daily lives. From the little items, such as your house keys, zippers, cellphones and gadgets, to high-tech equipment that allow scientists to study Mars, the Earth’s minerals have allowed man to do the “impossible.”
The Philippines has the resources to supply the growing appetite of the world for precious minerals and metals, according to a report released by the Senate Economic Planning Office in 2013. Citing the Mines and Geosciences Bureau (MGB), the report said the Philippines is one of the highly mineralized countries in the world with 9 million hectares considered to have high mineral potential. It also noted that the country has untapped mineral wealth worth at least $840 billion (P46.2 trillion) in gold, copper, nickel, chromite, manganese, silver and iron. The country’s gold reserves alone, the report said, can amount to P7.36 trillion. Citing the National Statistical Coordination Board, the report said the amount is enough to completely eradicate poverty in the Philippines.
For the mining sector to realize its potential, the government must put in place the necessary policies that would attract and not drive away investors. Former Socioeconomic Planning Secretary Romulo L. Neri said in 2004 that the full development of one large-scale mining site alone requires an investment of $850 million to $1.2 billion, an amount difficult to source from local investors.
Measures that seek to raise business cost, such as an additional royalty fee, will not encourage the type of investors needed by the local mining sector. The government could look into the “commodity-based” taxation scheme, which the MGB has deemed as less onerous, and proposals to tax profit and the gross earnings of mining firms.
Instead of closing responsible mining sites, the government should use them to fast-track the country’s industrialization. It can do this, for example, by disallowing the exports of raw, beneficiated or semi-processed nickel ores from operating nickel mines. According to Engr. Graciano Calanog, the expert who recently wrote in the BusinessMirror about how the Philippines can cash in on the global e-vehicle revolution where nickel plays a key part, the government must require miners to set up ferro-nickel smelter and leaching plants, reverberatory furnaces/converters and nickel refineries that will produce nickel metal for the electric vehicle market. These facilities will enable the Philippines to take full advantage of the electric vehicle revolution and can help the government raise revenues needed to improve the quality of lives of Filipinos.
The nickel industry alone, according to Calanog, has the potential of leap-frogging the Philippines from a semi-developed to an industrialized/developed country in less than 10 years, if the right policies are in place. Imagine what the Philippines can gain if it has a well-thought-out plan for the entire mining sector.
Image credits: Jimbo Albano