BAYAN slams mining myths, supports admin efforts*

MANILA, Philippines – The foreign-controlled, large-scale mining industry today contributes little—if not virtually nothing—to alleviate poverty in the country and, in many cases, exacerbates and adds to the hardship and suffering of people in areas where irresponsible miners leave a trail of destruction of the ecology and environment. BAYAN supports the efforts of the Duterte administration in holding to account large mining companies accused of violations of environmental laws.

It must be stressed that whatever benefits the economy derives from the present mining industry are negated by the long-term costs to the environment and the health and well-being of people in many mining areas.

We are a net loser as far as this extractive industry is concerned. The costs simply outweigh the benefits.

In provinces where there are large-scale mining operations, the poverty incidence remains very high, except in Benguet. These are:

                             Province                       Poverty Incidence (2012)
Eastern Samar —————- 63.79
Agusan del Sur ————— 48.2
Surigao del Norte ————- 41.8
Leyte ———————– 39.2
Compostela Valley ———— 36.7
Surigao del Sur ————— 36.0
Agusan del Norte ————– 34.7
DInagat Islands ————— 33.4
Camarines Norte ————– 28.7
Palawan ——————— 26.4
Cebu ———————— 22.7
Zambales ——————– 16.0
Benguet ———————- 3.7

For mining to have substantial and long-term contribution to poverty alleviation and the growth of the economy, it must generate significant employment opportunities and help fuel the country’s industrialization.

But over the years, the mining industry’s contribution to employment has not exceeded one percent, according to official data from the Mines and Geosciences Bureau. In more than one decade from 2003 to 2012, during which there had been a boom in mining, the industry’s contribution to employment hardly moved from 0.3 percent to 0.7 percent.

Mining’s contribution to employment (in percent) from 2003 to 2012

2003   |  2004   |   2005    |    2006    |    2007     |    2008   |    2009    |    2010    |   2011    |    2012
0.3         0.3             0.4            0.4             0.4               0.5             0.5             0.5           0.6            0.7

The mining industry adds little to economic production and productivity—it contributes less than one percent of the country’s gross domestic product.

Noted a 2013 policy brief prepared by the Senate Economic Planning Office (SEPO): “Mining’s contribution to the economy is small, ranging merely from 0.6 to 1.0 percent of the GDP [from 2003 to 2012]. In 2012, mining accounted for merely 0.7 percent of the GDP.”

From 2013 to 2015, mining’s share of GDP averaged at one percent, according to data from the Philippine Statistics Authority.

The industry’s contribution to exports has also been dismal—ranging from 1.8 to six percent from 2003 to 2012 despite the steep rise in the prices of gold, nickel and copper in the world market.

“Mining has never played a major role in national development even during the mining boom of the seventies and early eighties” said the Senate Economic Planning Office in its policy brief, citing a study by former Economic Planning Secretary Cielito Habito.

The policy brief said the measly contribution to the economy is attributed to the limited processing of minerals in the country, noting that most of the industry’s products are currently exported in primary form—as raw material ore. “For 50 years, the mining industry has remained to be an extract-and-export-ore activity and there is no significant industrialization footprint,” the SEPO said.

Philippine mining simply fuels the industries of other countries, supplying them with raw materials.

If we are to reverse this situation, we need to overhaul our policies, rules and regulations so that we can optimize the benefits from extracting our national wealth.

Neither does government derive substantial taxes and revenues from mining—money that could otherwise go to poverty-alleviation programs or to mitigate the adverse impact of mining on communities.

The Philippines Poverty Environment Initiative, a joint undertaking of the United Nations Development Programme, UN Environment Program, Department of Finance and Department of the Interior and Local Government, reports that the total taxes and fees paid by mining companies to the national totalled only PhP8.4 billion in 2009 and PhP5.4 billion in 2010.

They represent just about one percent of the total value of the industry’s output for the same period.

According to the Senate policy paper, the taxes and other fees collected by the government from mining make up less than one percent of GDP, which pales in comparison to those of countries such as Chile, Peru, Ghana, Zambia and Papua New Guinea which have revenues from mining that exceed ten percent of their gross domestic product. The policy brief noted that in other mining-intensive economies such as Australia and Chile, the excise tax is as high as 15 percent.

Yet the environmental and social costs of mining are high—negating whatever economic benefit it may have or revenues that government may generate.

The Senate report cited a 2007 study by a team of exports from the United Kingdom which found that mining operations in the Philippines: 1) invariably evicted indigenous peoples from mining sites; 2) poses an imminent danger to indigenous culture; 3) polluted the rivers at their sites; 4) destroyed mangroves; 5) damaged coral reefs; 6) ruined agriculture; and 7) damaged the nation’s biodiversity.

The team observed that “the record of mining companies with regard to environmental protection, disasters and post-mining clean-up in the Philippines is widely acknowledged to be very poor”

The Senate paper also cited a report by Clive Montgomery Wicks, vice chair of the Commission on Environmental, Economic and Social Policy of the Switzerland-based International Union for Conservation of Nature (IUCN), which noted that most of the mining companies in the Philippines do not identify the possible dangers that might occur, as well as their proposed remedies in such events in the required Environmental Impact Assessment/Environmental Impact Statement (EIA/EIS).

It said this is contrary to international standards, where mining companies are obliged to identify the environmental impact posed by their operations and to identify contingency or remedial measures that will be undertaken.

We ask the Duterte administration to be unwavering in its protection of the rights of the people in the mining communities. The biggest polluters of the environment and oppressors of the people should be held to account./PT

*Originally posted at bayan.ph.

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