The mining industry in the Philippines is useless because it contributes a very small percentage to the country’s economy for the past 20 years, according to a research group.
The research group, Ibon Foundation, said on Thursday the mining industry has had no substantial contribution to the Philippine economy since 1995, or 20 years after the industry allowed entry of foreign firms as stipulated in the 1995 Mining Act.
As of the first quarter of 2015, according to Ibon, which is the latest recorded data on the mining industry, the Philippine economy got only 3 percent of the entire income of the mining industry in the country.
The huge 97 percent for the same period went to the United States and China, among other countries, it said.
Also on Thursday, the Philippine Chamber of Mines, in a recent conference, cited positive gains of the country’s mining industry.
The three-day international mining conference, held at Solaire Resort Hotel and Casino in Manila, focused on the supposedly significant role of the mining industry in the country’s development and in the global economy.
Ibon noted that Philippine economic indicators in terms of the gross domestic product and employment clearly showed that the mining industry produced a very small percentage of the GDP.
Data that it provided revealed that foreign investments in mining fell from $1.45 billion in 2013 to $693.1 million in 2014.
The share of mining in the gross domestic product was only 0.7 percent, while its contribution to employment was only at 0.6 percent.
Government shares from mining in taxes, royalties and fees amounted to P22.83 billion in 2013 or a measly 1.33 percent of total tax revenues.
Ibon said 97 percent of mineral production in the Philippines go to foreign industries, proving the export-oriented nature of Philippine mining.
The industry actually “supports other countries’ industrialization and profit instead of being instrumental in the development of local industries,” the group pointed out.
It said mining is unarguably vital to an economy, but it “has unfortunately been vital to other economies” instead of the Philippines’.
“To illustrate, as the second-biggest automobile producer in the world, the US usually uses 40-60 percent mineral components, computer chips and other electronic products use 60 percent in minerals. For every dollar in the final output, mining contributes 45 cents to electrical equipment and 42 cents to machinery.”
Ibon said the country’s agriculture, industry and service sectors can benefit from mineral products in construction, power, electronics, machinery and transport.
To realize that, it added, the “government must reverse its current pro-foreign mining policy.”
“Minerals are non-renewable resources but the government’s further liberalization of the mining sector is tantamount to giving up the country’s chances for industrialization,” Ibon argued.