Philippines to submit 1st mining industry report

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Saturday, July 19, 2014


THE Philippines is currently drafting its first country report on the mining industry for submission to the Extractive Industries Transparency Initiative (EITI) international board in December this year, according to the Department of Finance (DOF).

Regular country reports are among the requirements for admission to the EITI, a global standard ensuring transparency of revenues from natural resources, said DOF Assistant Secretary Teresa Habitan, who is also the focal person for the Philippines EITI (PH-EITI), a multisectoral group that will oversee the implementation of EITI.

The Philippines was admitted as a candidate country to the EITI program on May 22, 2013, in Sydney, Australia.

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Admission to the EITI program is mandated by Executive Order No. 79, signed by President Benigno S. Aquino III on July 6, 2012. The law seeks to implement reforms in the mining sector to "ensure environmental protection and responsible mining" of mineral resources.

Under Section 14 of E.O. No. 79, the country is called to join the EITI "to improve transparency, accountability, and governance in the sector."

The EITI, created through E.O. No. 147, aims to promote transparency, ensure better governance, and make sure that the government gets its “just share” of revenue from the industry, said Habitan, who spoke at a public forum on minerals development held July 10 at the Development Academy of the Philippines.

This as Habitan said figures on how much is actually collected from the extractive industry are "disparate" and widely varying.

The Bureau of Internal Revenue (BIR) has its own data, while the Mines and Geosciences Bureau (MGB) also has its own figures that include the royalties that companies pay.

Moreover, regional governments and local government units (LGUs) also impose fees that are not reflected in the national data.

The EITI is "tasked to get the whole picture" of what the government is actually getting, she added. Companies which have elected to participate in the EITI "must show how much they paid the government."

Because there is yet no central agency compiling all the collections from the mining sector, Habitan said the first phase of the EITI covers information-gathering only on the more than 30 large-scale mining companies in the Philippines.

The PH-EITI will try to compile all acquired data from the BIR, MGB, Bureau of Customs, Department of Energy, LGUs, and the mining companies themselves, and reconcile all the figures.

In the second phase, the group will include small-scale mining companies in their studies.

In an earlier media interview, Department of Finance Secretary Cesar V. Purisima said mining represents only 1.04 percent of GDP but has potential to attract foreign direct investments and increase exports.

"However, President Aquino wanted to ensure mining was not only profitable but more importantly sustainable for our communities and our environment. EITI allows us to track revenues to ensure accountability through transparency," he added. "Looking forward, mining can only be sustainable if we institutionalize reforms and good governance through initiatives like EITI." (Philexport)

Published in the Sun.Star Cagayan de Oro newspaper on July 19, 2014.

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