The Philippines is a country of enormous potential because of its rich mineral resources, which, sadly, remain largely untapped because of poor policy and regulation, said John Forbes, president of the European Chamber of Commerce of the Philippines (ECCP).

Interviewed during a news conference highlighting the launch of the Joint Foreign Chamber of Commerce’s Policy Brief No. 3, titled “Responsible Mining: Realizing its Potential,” Forbes said the mining sector can still greatly contribute to the country’s economic growth—which it has done in the past—if the government puts in place the right policy environment that will make mining globally competitive. Forbes, who presented “Arangkada Philippines 2010: A Business Perspective,” discussed the enormous potential of the minerals-development sector. He said the current contribution of mining to the country’s gross domestic product (GDP) remains miniscule even though its mineral resources amount to trillions of US dollars because of the very little, insignificant tapping of the potential.

“We have trillions of US dollar assets here in the country that are untapped.  If you leave it on the ground, it will remain untapped,” he said.

The Policy Brief on Mining underscores the vast potential of the minerals-development sector in contributing to the country’s economic growth.  According to the policy brief, citing various data, by 2003, mineral products were only 2 percent of total export value but after the Supreme Court upheld the constitutionality of the Philippine Mining Act in 2005, the industry experienced a substantial increase in export production, growing up to 4.36 percent of total exports.

Forbes said the government is to be blamed for the mining sector’s poor performance and inability to realize its full economic potential.  The policy brief said that inconsistent policy actions, moratoria on approvals of new production, designation of widespread “no go” zones, and a proposed, tougher fiscal regime that may be introduced by the government have left the future expansion of the industry highly uncertain.

In 2013 the mining industry contributed P78 billion, or roughly around 0.7 percent of GDP, to the economy and employed 250,000 people, which was about 0.7 percent of the national employment.

Forbes said there is a need to make mining in the Philippines more competitive, to lure more investors that could spur economic growth

“The mining industry will only go [to the Philippines] if they find a competitive situation, if they can earn money, if they find that the Philippines is competitive.  If they find the Philippines is uncompetitive, then they will not invest,” he said.

“Foreign direct investment in the Philippines is not only in mining.  But overall, it is the lowest,” he said.

In the past, he said, the mining sector significantly contributed to the country’s economy.

“The Philippines is a country of enormous potential and we hope that it will not stay that way,” he said.

Nelia Halcon, executive vice president of the Chamber of Mines of the Philippines, enjoined academe to have a dialogue on the existing revenue-sharing scheme with the aim of convincing the government to revisit the said regime.

Policy recommendations put forward by the panel included an appeal for local government to respect national law so that local government units may not block mining activities through local ordinances; observe international practice in ensuring that all government agencies respect existing contracts; and no-go zones should not be declared without proper evaluation of the relative value of the zone.

Arangkada Philippines project is an advocacy of the Joint Foreign Chambers, which includes The Joint Foreign Chambers in the Philippines  composed of the Philippine chapters of the American Chamber of Commerce; Australian-New Zealand Chamber of Commerce; Japanese Chamber; Canadian Chamber; European Chamber; and the Korean Chamber; and the Philippine Association of Multinational Companies Regional Headquarters.

The third policy brief is also sponsored by the Makati Business Club, the Philippine Chamber of Commerce and Industry, Philippine Exporters Confederation Inc., among other local business groups.

Source: Business Mirror, 11 September 2014