Mining has been in the news again. At least 45 people perished in a mining town in Benguet when heavy rains brought by Typhoon ‘‘Ompong’’ last week caused a massive landslide that destroyed an old three-story building, a former mining bunkhouse.
Authorities in Itogon said many miners and their families had trooped to the structure at the height of the typhoon, ignoring warnings to evacuate. They were consequently buried.
Department of Environment and Natural Resources Secretary Roy Cimatu had since ordered the suspension of all small-scale mining operations in the entire Cordillera region, and subsequent closures would be done in phases, including the cancellation of all temporary permits.
“The first phase is to stop [this illegal mining]. The second stage will be to relocate them [small-scale miners] out of these very dangerous areas,” he said.
In the wake of the suspensions and closures, the government is reportedly considering setting up two Minahang Bayan, or community mines, outside the landslide-affected areas toward the end of the year. A Minahang Bayan centralizes the processing of mined outputs within a designated area, effectively regulating small-scale mining activities and ensuring that such tragedies never happen again.
“We are legitimizing small-scale mining in the country. Establishing it would allow them to know where they should only operate. But once declared, they will have to comply with environmental standards and they should just sell their gold output to the central bank,” said DENR Undersecretary Analiza Teh.
Aside from compliance to safety regulations, a Minahang Bayan also guarantees against environmental degradation and enables the government to collect proper taxes from such operations. There are about 20 Minahang Bayan all over the country, many in Cordillera, Bicol, Compostela Valley, and Zamboanga, while over 100 applications remain pending with the DENR.
“We cannot just ignore the small-scale miners. They have been there, we just have to fix them. But they should also help us through self-policing and self-discipline,” Teh added.
The problem in the coverage of such events is the glaring lack of distinction between such small-scale, often illegal, operations and the legitimate, highly regulated large-scale mining. Because areas like Benguet are associated with mining and the fatalities include miners and their families, anti-mining groups will simply blame mining per se. This glosses over the fact, for instance, that large-scale mines are in no way associated with the tragedy in Itogon.
And precisely because they are squarely within the fold of state regulation, such operations also contribute the most to the Philippine economy. Reports said the total Philippine metallic mineral production value grew by 4 percent year-on-year in June from P52.42 billion in 2017 to P54.57. As a sector, mining contributed some P53 billion to the economy in the first half of the year alone, while mineral exports reached $1.1 billion.
In terms of jobs created, some 215,000 Filipinos were employed in the industry. Mining companies also paid some P644.4 million in royalties and other charges to the government, with a further P292.6 million in extra taxes, fees, and charges to host local government units. As high as they are, these figures don’t include yet the staggering P16.42 billion that the industry has committed for social development programs across nearly 1,000 barangays all over the country, surely to benefit hundreds of thousands of people in areas like education, livelihood, and health.
But, even if the industry is evidently doing a lot, “enforcement is critical,” Cimatu stressed.
He explained: “Reinventing mining entails improving the MGB monitoring of operations and compliance of mining companies to mining and environmental laws, rules, and regulations. Enforcing fines, penalties, suspension and closure to demonstrate no-nonsense putting into force compliance and promoting deterrence for commission of violations is imperative.”
Fair enough. And perhaps the suspension of small-scale mining operations in Cordillera will enable a healthier, more sober discussion about the direction of mining in the Philippines as a whole insofar as they reveal systematic problems.
The negative image of the mining sector, coupled with policy inconsistencies, prevents the industry from fully accelerating, especially considering the vast untapped mineral wealth underground. A reinvigorated mining industry will invigorate Industry, which could jumpstart development in the countryside via infrastructure, employment, taxes, and exports.
But this would only be possible if the policy environment is conducive to the kind of large-scale investments that mining demands. On the issue of taxation, for instance, the proposed rates in the second package of the government’s tax program are too prohibitive to the point of ruin, endangering billions of existing and potential investments.
While the mining sector is not averse to a revised tax structure, it has to remain sensible and competitive to attract quality investments from the world’s major players. After all, it is important to remember that our minerals are competing with the rest of the world’s, and many countries have in place sophisticated and attractive tax structures.
“We are talking about billions of pesos in lost investments, lost taxes, particularly employment and social development that is critical,” said Chamber of Mines of the Philippines chairman and Nickel Asia Corp. president and CEO Gerard Brimo.
And with such investments come knowledge and technologies that could tap the country’s resources in the most efficient and ecologically sound manner possible. In the absence of such quality investment, mineral-rich areas like Benguet run the risk of continuing to fall prey to more illegal operations that are destructive to the environment and unsafe, not to mention the billions of revenues that gold smugglers will hijack from government.
Thus, any measure that will virtually halt any momentum for the industry will only perpetuate the cycle that we see at play in Itogon. In many ways, this marks a crossroads in the way that government has managed the sector. There is really no choice but to strictly enforce our mining laws. The capacity of the regulating agencies must be strengthened with adequate technologies resources and talent. The fact that small-scale mining produces more than half the country’s annual mineral output should be main focus of regulation.