The local mining sector has failed miserably to deliver its promise of economic progress and development in a national scale, as far as statistics by the Mines and Geosciences Bureau (MGB) are concerned.

Industry figures aggregated by MGB from 2000 to 2009 reveal that, on the average, the mining industry has merely accounted for no more than 0.91 percent of the Philippine gross domestic product (GDP). “Up to 2005, mining and quarrying accounted for less than one percent—from 0.6 percent to 0.9 percent—of Philippine GDP,” notes Margarita Gomez, an economist at Revenue Watch and coordinator of Bantay-Kita-Action for Economic Reforms, in her 2010 study entitled Transparency Issues in the Philippine Mining Industry: Towards Tax Justice. “From 2005 onwards, the mining industry’s contribution increased to one percent and above. To date, its greatest input to the country’s GDP has been 1.4 percent in 2007.”

In contrast, agriculture, fishery and forestry—industries that have all been recognized as key sectors in the Philippine economy despite being constantly under the threat of mining—accounted for 16.5% of the total GDP on the second quarter of 2009 alone.

The study—which cited figures from MGB’s Mining Industry Statistics released on February 2010, November 2010 and May 2011, respectively—also added that the mining industry’s contribution to total Philippine employment has, likewise, been described as “very modest.”

“In terms of employment, the mining sector has accounted for no more than 0.3 percent of the country’s total employment from 2000 to 2004, rising to 0.4 percent from 2005 to 2007, and 0.5 percent in 2008 and 2009,” the paper reveals. “On the average, the industry’s contribution to total employment during the decade was no more than 0.376 percent.”

Environment advocates and economists referred to a mining project in Mongolia to best illustrate this point. “The Oyu Tolgoi (in Mongolia) is approximately a US $100 billion mine over 40 years. That is expected to be the third largest copper mine in the world. It has generated a total of 11,400 jobs during the construction phase, but only 3,500 jobs will be permanent eventually,” according to a coalition spearheaded by the Save Palawan Movement, the Catholic Educational Association of the Philippines, Ateneo de Davao University, and Alyansa Tigil Mina.

“Therefore, employment may only be intensive in the initial stage, but labor absorption is likely to decline over time because more labor-saving technologies are adopted in the industry. Agriculture, on the other hand, contributes nearly two-fifths or 40% of the jobs here in the Philippines.”

Gov’t gets nothing significant, even in taxes

From 2000 to 2009, the contribution of mining excise taxes—large-scale, small scale, non-metallic operations—to total BIR excise tax collections has only been about 0.7%, according to former Commission on Elections (Comelec) Chairman and Save Palawan Movement advocate, Atty. Christian Monsod.

“The development role of mining is always described as ‘potential’ because mining has never played a major role in our sustainable development, not even during the mining boom of the 70s and early 80s,” explains Monsod, an esteemed member of the Constitution Commission that drafted the 1987 Philippine Constitution. “What’s even more disappointing is that mining excise taxes relative to total BIR collections is consequently even smaller at 0.07%.”

The Department of Environment and Natural Resources (DENR), Monsod claims, has also revealed very disturbing inconsistencies in terms of the actual figures being reported by the mining sector. “The exports figure that mining companies have apparently gathered exceeded the reported production values of minerals (Php 277 billion from 2000 to 2009),” Monsod notes. “Aside from this, there has also been a discrepancy between potential excise taxes from mining and the actual collections that the sector has actually collected (Php 7.8 billion from 2000 to 2009.)

Mining and public costs

Since mining activities are usually located in rural and mountainous areas, it obviously has a huge impact on farmlands, rivers and shorelines, where the poorest of the poor namely, the farmers, indigenous peoples and municipal fishermen, usually reside.

“The fact is that mining cannot be conducted without affecting and disturbing the land, water, and air surrounding and connected to the site, as well as the various natural resources found in them,” Monsod notes. “Mining does not only result in the extraction of minerals, but often also necessitates the use, removal, or destruction of non-mineral resources, such as freshwater, timber, and wildlife. This may also result in health problems, displacement of people, social divisiveness, even the need to provide PNP and AFP protection.

Then, there are the disasters that happen from the denudation of forests—from the dislodging of the rocks that anchor the trees, from siltation and erosion, as well as the accidents from mining structures. All these translate into public costs.

Responsible mining: a product of fiction

This glaring truth complements the recommendations aired by the Ateneo School of Government, led by Antonio La Viña, on its recent study regarding the future of mining in the Philippines.

The policy brief, an independent report based on objective and peer-reviewed documents, recommends that the government impose a blanket moratorium on mining that includes suspension of processing of submitted mining applications, and not only for cleansing of dormant or defective applications. “Based on our researches and analyses, supported by experts and stakeholders consulted in this study, the country is not yet capable of accurately measuring the real benefits and costs of mining,” the study reveals.

The moratorium, on the other hand, was also endorsed by the participants in the recently concluded nationwide conference on mining and the ecology, which staged regional forums in Davao, Iloilo, and Manila.

This simply highlights the fact that there is no such thing as responsible mining; the mere fact that mining operations are taking place in the Philippines—the seat of the world’s richest biodiversity that possesses an intricate web of ecological systems—is in itself very irresponsible.
“The government’s limitations in accounting for verifiable economic benefits versus environmental, social, cultural and economic costs are so serious that we are effectively gambling away our future. We are mindful of possible adverse economic displacement in imposing a moratorium today, which is at worst temporary,” the study adds.

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The Save Palawan Movement (SPM) is a non-profit, multi-sectoral volunteer organization that stands for the protection of our greatest resource—which is biodiversity. Armed with the support of more than 5.6 Filipinos and 849 organizations, SPM has been continuously fighting for the preservation of our island ecosystems, as well as poverty alleviation through community-based sustainable ecotourism and agriculture.

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