Monday, 25 October 2010 00:00 [ manilatimes.net ]
THE Department of Environment and Natural Resources (DENR) plans to identify more mineral areas throughout the country for possible declaration as reservations. DENR Secretary Ramon Paje said declaring additional mineral reservations will help provide equitable access to mineral resources and generate additional non-tax revenues for the government.
At present, the government gets a two-percent share of gross sales of mining operations in the form of the excise tax.
The government, however, will get an additional five-percent in royalties if the mining operations are held in declared mineral reservation areas, Paje said.
Section 5 of the Philippine Mining Act of 1995 or Republic Act 7942 provides that “when national interest so requires, such as when there is a need to preserve strategic raw material for industries critical to national development, or certain minerals for scientific, cultural ecological value, the President may establish mineral reservations upon the recommendation of the Director of the Mines and Geosciences Bureau through the DENR Secretary.”
Paje said there are nine mineral reservations located in Ilocos Norte, Zambales, Bulacan, Camarines Sur, Samar Island, Surigao del Norte, Compostela Valley, Zamboanga del Norte, and all offshore areas throughout the country.
The Philippines is considered as the fifth-richest country in terms of mineral resources with a mineral wealth worth more than $840 billion. This is equivalent to at least 10 times its annual gross domestic product (GDP) and more than 15 times its total foreign debt.
Based on government data, the country is believed to have substantial mineral deposits including copper, gold, nickel, chromite, limestone and semi-precious stones that can be found in the Sierra Madre mountain range in Luzon and in the Mindanao region.
In Mindanao, the area from Davao to Butuan is believed to be the richest mineralized area of the country.
Other areas believed to be rich with gold and copper deposits are Mt. Diwalwal in Compostela Valley in Central Mindanao, Benguet in Northern Luzon, and Rapu Rapu Island in Bicol. The provinces of Mindoro, Benguet, Zambales, Nueva Vizcaya, Cebu and Leyte also have rich mineral deposits.
Paje said mining has a multiplier effect of six times and can add up an incremental economic activity of at least $40 billion.
From 2003 to 2009, investments in the minerals industry reached $2.8 billion. The government aims to attract $13 billion by 2013.
The minerals industry has grown to comprise 5.4 percent of Philippine exports last year, while gross production value has increased by 159 percent from 2003 to 2009.
Mining is among the foreign chambers’ “seven big winners”—sectors projected to generate about $75 billion in foreign direct investment and at least 10 million jobs in the next decade.
However, the Philippines has been unable to realize the full economic potential of these mineral resources due to a wide range of setbacks including environmental and bureaucracy issues, court challenges, conflicting political views, and problematic support from the local government units.
The key concerns among foreign and local investors were the Supreme Court’s issuance of the “Writ of Kalikasan,” the ban on open pit mining in South Cotabato , and proposals to repeal the Philippine Mining Act of 1995.
JAMES KONSTANTIN GALVEZ
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