MANILA, Philippines — The Chamber of Mines of the Philippines (COMP) is hoping that the next administration will ensure a stable business environment for the mining industry to enable it to support the country’s post-pandemic recovery efforts.
In a speech before members of the Consular Corps of the Philippines, COMP chairman Michael Toledo described a stable business environment as one where “policies are reliable, contracts and investments are protected, and the rules do not change mid-stream”.
Toledo pointed out the mining industry’s tremendous potential to contribute to socio-economic growth, saying the country has an estimated untapped mineral reserves of $1 trillion or equivalent to three times its 2021 gross domestic product.
He said that mining used to be a huge contributor to the Philippine economy, particularly in the 1980s when the industry accounted for 21 percent of the country’s export earnings and over two percent of GDP. In 2020, mining’s share in total exports and GDP plummeted to eight percent and to 0.6 percent.
Toledo attributed the decline to a combination of factors, including policy roadblocks such as the recently lifted 9-year moratorium on new mining projects and four-year ban on open pit mining.
Despite the lifting of the ban on open pit mining by the national government, the Tampakan project in Mindanao remains undeveloped due to a provincial code that still bans the mining method. In line with this, Toledo stressed that the next government must harmonize local and national laws to avoid conflicts on the ground.
He said Tampakan, along with two other copper-gold projects Silangan and Kingking, can increase yearly national government revenues by P12 billion a year, local government revenues by P1.5 billion, exports by almost $2 billion, and social expenditures by close to P800 million per year.
Toledo said royalties to indigenous tribes may also increase by over P600 million annually.
“The Philippine Mining Act of 1995 is considered by many industry experts to be one of the most advanced mining laws. Its social and environmental provisions are comparable to measures formulated in industrialized nations. What is needed is to increase the capability of government, both national and local – and the political will – to fully implement it,”Toledo said.
Meanwhile, Toledo also expressed hope that the next government would further its roles as facilitator, partner, and demonstrator of environment, social, and governance (ESG) best practices in the mining sector.
He said the Mines and Geosciences Bureau (MGB) has supported COMP’s adoption of the Towards Sustainable Mining (TSM) by allowing the industry association’s members’ to allocate a portion of their mandated social development funds for this initiative.
TSM is a growing global standard for best practices in mining. Started in 2004 by the Mining Association of Canada, the TMS has proven to be very effective in raising the standards of mining in the country.
Toledo said COMP also hopes the next government will continue encouraging increased transparency and reporting of ESG practices in mining.
“With strong support from our current government, our participation in the Extractive Industries Transparency Initiative (EITI) allowed us to further demonstrate our commitment to the highest standards of transparency and accountability in business,” Toledo said.
He said the Philippines was the first out of 51 implementing EITI countries found to have satisfactorily met the 2017 EITI Standard for fiscal transparency in the extractives sector.
“We in the Chamber are determined to be a strong partner in nation building – one with a strong focus on social development, on minimizing the impact of our operations on the environment, and on ensuring a fair division of economic and financial benefits of mining,” Toledo said.
“But first, please allow us to flourish. Modern mining technology, global mining standards, and the increasingly stringent laws of the land governing mining have evolved in the last two decades to assist, enable, and guide the industry to become a responsive partner. We like to think that we have also evolved in lockstep with these developments,”he said.