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Wednesday, December 15, 2004
One-third of RP land area targeted for mining
THE mining potential of the Philippines is so vast that the government has targeted nearly a third of the country’s total land area as possible sites for mining.
But environmental advocates fear that mining will destroy the environment, a charge quickly dismissed by industry players.
“Nine million hectares have been targeted as the potential areas (for mining) in the Philippines,” said Mines and Geosciences Bureau Director Horacio Ramos.
In an interview over ANC Network, he said the Philippines has a total land area of 30 million hectares.
Mining advocates have been pushing for increased investments in the industry after the Supreme Court ruled that 100-percent foreign-owned firms could engage in mining in the Philippines.
With the country in a financial bind, the glitter of mineral riches is becoming increasingly hard to resist, especially after some quarters put the mining potential of the Philippines at 15 times the country’s foreign debt. The foreign debt is about $56 billion.
Trade Secretary Cesar Purisima has said the Philippines could be the fifth largest mining power in the world, sitting on some 20 percent of the world’s nickel resources.
The country is also said to host the third-largest reserves of gold on earth.
Vast reserves
During the TV interview, Rudy Obial of the Philippine Mineral Development Instiatute said mining firms have long known about the vast mineral reserves of the country.
After the 1995 Mining Act was passed, “70 mining companies immediately applied for FTAA (financial technical assistance agreements) from 1996 to 1997, but not one of these were approved,” he said.
Mining’s contribution to the Gross National Product was 2.2 percent in 1985, but it has now been reduced to about 1.5 percent.
A representative from Lepanto Consolidated Mining Corp. assured the public that mining would not destroy the environment, saying vertical tunnels are built into the ground to extract the minerals so that the surface area is not destroyed.
Obial cited another example, that of Benguet Corp., an over 100-year-old mining firm that undertakes all its exploration through veins underground so that pine trees still grow above the exploration area.
Forest
However, Blas Tabaranza Jr., program director of Haribon Foundation, was not convinced, voicing concern over the less than a million hectares of forest cover left in the Philippines.
The Mines and Geosciences Bureau’s Ramos assured him that mining would not be allowed in protected areas.
But even if the environment would not be destroyed, Tabaranza said he still failed to understand how the recent Supreme Court ruling could be favorable to Filipinos when foreign mining firms would be entitled to a five-year income tax holiday, which means mining firms could repatriate all their earnings during that period.
“They can bring in equipment and spare parts tax free,” he added.
Ramos clarified that the income tax holiday applies only to national taxes.
“Local governments could still benefit within the five years,” he said.
In addition, after the five years, the Philippines will benefit in a “60-40 sharing,” where the country could get some 60 percent of the earnings of the mining activities through indirect taxes and a share in the revenues, Ramos said.
To encourage the public to adopt a more favorable attitude toward mining, Ramos said permits given for mining activities in over 400,000 hectares in the country had brought $6 billion in investments to the country. (CTL)
(December 15, 2004 issue)
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