Why can’t we?

CTALK - Cito Beltran - The Philippine Star

Manny V. Pangilinan aka MVP recently asked the question in relation to mining in the Philippines: “If the South Africans, Australia, Indonesia and China operate their mining businesses well enough; if others can conduct their mining operations responsibly and sustainably, why can’t we?”

As the keynote speaker of the 2023 Mining Conference at the EDSA Shangri-la hotel, MVP raised and revived several mining-related issues and concerns that clearly need to be properly addressed based on research and correct policies.

What initially caught my attention was the fact that he started his speech by sharing a story from August 2012.

“Euls Austin, president of Philex Mining, called to report that due to two weeks of heavy rains, their tailing pond in Pacdal, south of Baguio, had developed a problem, resulting in significant amounts of water and mud escaping to the valley below.

“We decided – voluntarily, and without government prompting – to shut down all mining operations immediately and move swiftly to repair the damage and avert a major environmental crisis. That midnight I messaged President Noynoy Aquino about the mining accident, and the timely steps we’ve taken.

“There were no fatalities and PHILEX paid a fine to the government of more than P1 billion. Yes, for the first time in my career, I saw the inherent risks associated with mining. But more importantly, what responsible mining means in the face of a consequential crisis.”

Most speech writers, PR specialists and even public speakers would have advised against opening MVP’s speech with a negative narrative or a story that could be used against him or the mining industry. You let sleeping dogs lie, lest they bite you.

But as I read the printed version of MVP’s speech, I got the impression that he was driving home not just lessons but proof that, contrary to the negative hype against mining, companies like PHILEX were professionally run, responsive and took responsibility for “consequential crisis.” By pointing out that the company paid over P1 billion in fines, not to mention stringent corrective measures, MVP reminds us that the government does its part in regulating as well as penalizing industry players for their mistakes or short comings.

MVP pointed out that the world has now more than ever become dependent on metals and minerals that are needed in producing technology such as computers, cellphones and various other electronics and mining will be a major contributor in providing the key ingredients for those technology.

“The world is entering an era of sustained resource demand as economies expand and population explodes. The Philippines missed the economic bus during the manufacturing cycle in the 50’s and 60’s, and the export boom in the 70’s and 80’s. This time we cannot miss this bus yet again, with our available mineral resource base.”

The Philippines was not blessed with oil fields like the Middle East or some of our neighbors in the region. Our only income generating export are OFWs and even that is beginning to shrink due to competition and technology. President Marcos Jr. has confirmed our over dependence on importation while the Department of Finance has no choice but to borrow in the billions in order to fund the supersized bureaucracy that is the Philippine government.

Despite its many imperfections, mining in the Philippines does offer us options in terms of high value exports, job generation, a revenue source for the national and local governments as well as a source of foreign currency to counterbalance our international debts.

But in front of all this the emphasis of MVP’s speech was on responsible mining, where all stakeholders do their part with a spirit of cooperation.

“I’d be first to admit that our industry has to level up when it comes to sustainability practices and standards. But the mistakes of a few should not lead to the notion that the whole is wrong. An industry should not be judged based on its worst members.”

As was expected of a keynote speaker, MVP essentially set the course of action that the conference participants and industry players could undertake to improve the state of mining in the Philippines.

“First, address health-related and safety concerns, the exploitation of women and child workers. The lack of clarity of plans and actionable post-mining rehabilitation, which can restore mine sites to their original natural state.

“Second, the private sector should help government raise its supervisory capabilities through funding of scholarships and training here and abroad, procurement of equipment and hiring of requisite personnel.

“Third, separating the functions of regulation and the promotion of the mining industry. The Mining and Geosciences Bureau is charged with the promotion, development and supervision of mining. The Environmental Management Bureau’s mandate is to enforce environmental laws on mining. Both fall under the supervision of the DENR.

“These apparently conflicting goals can at times place the DENR in a policy dilemma. Our suggestion is to spin off the EMB into a separate and independent body, similar to the Environmental Protection Agency in the US.

“Fourth, PHILEX is open to a profit-based fiscal regime as proposed by House Bill No. 8937 providing for a Royalty Rate against margins realized by mining companies, as well as a windfall profits tax.

“Finally, the mining benefits between host LGUs and the national government should be shared more equitably. The national government must ensure the timely remittance of taxes due to LGUs. After all, mining is location specific and LGUs naturally desire to realize the fruits of the resources situated in their communities.”

Given how President Bongbong Marcos has expressed support for the development of mining in the Philippines, perhaps it would be best for all concerned to also invest time, money, resources and expertise in developing the “handbook” for Philippine mining so we can stop asking: “Why can’t we?”

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