The Chamber of Mines of the Philippines (COMP) on Tuesday blamed the Aquino administration’s mining policy for the continued decline in investments in the country’s mineral sector.
In his opening speech at the Mining Philippines 2015 Conference & Exhibition, COMP president Bejamin Philip Romualez said that the last five years have not been encouraging for the country’s mineral development industry, with only 24 percent of the investment target having been realized.
“We need to help overcome this declining trend,” Romualdez said.
Based on records of the Mines and Geosciences Bureau (MGB), total investment in the mining sector reached $693 million in 2014, way below its original projection of $3 billion.
“The Philippines is lagging behind its Asean neighbors in terms of foreign direct investments. Had the big-ticket (mining) projects in the pipeline pushed through, we would have obtained almost $20 billion in investments, and thousands of people would have been employed, with more businesses established to meet the needs of these new mines,” he said.
“Yes, we continued with our respective company activities but beyond that, there were no significant industry news except for the operation of Nickel Asia’s second HPAL (high pressure acid leach) project,” he added.
The COMP official attributed the huge decline in mining investments to President Benigno S. Aquino 3rd’s issuance of Executive Order 79, which forbids the signing of new mineral agreements until a new mining revenue sharing scheme is legislated.
While mining permit issuances are on hold, the government is mulling increasing mining taxes to as much as 71 percent, the highest among Asean countries.
“On the global scene, with Europe still struggling to recover from the debt crisis and China’s economic slowdown affecting demand for commodities, the prices of copper, gold and nickel have been steadily going down in the last two years. There are forecasts that prices will rise in 2019 but we only hope this will come soonest,” Romualdez said.
Optimistic on 2016 elections
But despite the lackluster performance of the industry under Aquino’s helm, mining companies are elated and optimistic with the coming 2016 elections.
“The election of new leaders next year should give us some optimism. We hope to have a more pragmatic vision and plan for the mining industry and a doable action plan,” he said.
Mining Philippines is an annual international conference where critical industry issues are undertaken by the mining industry. The three-day conference beginning September 15 will feature international and local experts who will speak on various industry aspects.
The government earlier said that EO 79 seeks to balance important concerns on mining development in reinforcing environmental protection measures, promoting responsible mining, providing a more equitable revenue-sharing scheme and providing coordinative mechanisms among stakeholders including local government units (LGUs).
EO 79 bans mining in prime agricultural and fishing areas as well as in 78 designated ecotourism sites, including almost the entire province of Palawan.
It also disallows the issuance of new mining permits until Congress passes a measure increasing the royalty tax imposed on the gross earnings of mining companies to 5 percent from the current 2 percent.
The presidential directive calls for a thorough review of existing mining operations to ensure compliance with mining and environmental laws. It likewise underscores the need for national laws and local ordinances to be harmonized to ensure the proper management and regulation of the lucrative industry.