http://www.mineweb.net/sections/sustainable_mining/411155.htm

Unjust, Unsustainable Mining Industry

By Kalikasan-People’s Network for the Environment

Cordillera Peoples Alliance joins Feb. 3 picket against International Mining Investment Conference in Makati City                                           Photo from www.cpaphils.org

Contrary to the claims of Mines and Geosciences Bureau Director Horacio Ramos, in his letter to the editor (PDI Jan. 7, 2005), the Mining Act of 1995 which embodies the mining program of the Arroyo government remains defective, unsustainable and environmentally-devastating.

Ten years after its enactment, the Philippines has neither been brought to economic development nor alleviated from poverty. Instead, it has caused more hardship and environmental catastrophes. The mining liberalization program of the government has resulted not in a prosperous and vigorous local mining industry; instead it has perpetuated the country's backwardness.

Since the early 1980's world prices for metal products started to fall dramatically, which triggered widespread bankruptcy in the local mining industry. It intensified the crisis of the pre-industrial, export-oriented and import-dependent production of the local mining industry. Total mineral exports valued at $1.24 billion in 1979 went down to $893 million in 1995. Mining corporations either closed down or reduced their production. During the mining production peak, there were 45 metal mining corporations in 1980; the number dwindled to 17 in 1995.

Instead of nationalizing the industry and making it serve for our own country's industrialization, the government passed the Mining Act on March 3, 1995 that laid out a pro-foreign investment climate in the hope of reviving the centuries-old mineral production for export. The Mining Act provides several and important economic incentives and political rights to foreign transnational mining corporations (mining TNCs) such as 100 percent ownership and control of over 81,000 hectares of land for 50 years.

In 1994 the mining industry employed a meager 0.44 percent of the total employment but this was further reduced to 0.39 percent in 2002. Metal productions continued to decline and mining corporations closed down. In 2002 there were only 11 metal mining corporations in the country. Among these were the Atlas mines, once the biggest copper mining in Asia, Dizon mines in 1998 due to a mining disaster and the Maricalum mines in 2001 because of financial difficulty. What little downstream mineral industries we had, such as the National Steel Corporation (NSC) and Philippine Associated Smelting and Refining Corporation (PASAR) that partly processed the minerals extracted also closed down.

This is largely due to the continued depressed prices in the international market. Mining investors pulled out of the country in spite of favorable mining investment because it has not been profitable then to extract minerals in the Philippines and export these abroad. Up to now almost all the metal minerals extracted in our mountains and forest are exported abroad as raw materials.

Ironically while we are so rich with mineral resources, we remain heavily dependent on imported metal manufactures. In 2002, we imported iron, steel and copper manufactures totaling $786.8 million while we exported the same products worth $38.11 million with a balance of $-748.69 million.

Even the promised hundreds of thousands of jobs to be generated under the mining liberalization program failed to materialize. In 2003-2004 the Arroyo administration approved three large-scale mining projects with a total potential investment of $202 million (Php 17 billion) but it will only generate less than 1,000 jobs during the actual commercial production. As of now the mining industry employs around 114,000 people but most of them are in the quarrying and small-scale metal mining production.

These facts attest that the Mining Act and the mining liberalization program of the government have failed to solve the bankruptcy upsetting the mining industry. Yet, the government, the international financial institutions and the mining TNCs are still harping that the crucial and key factor in the development of the local mining industry is the entry of foreign investment in the country.

As affirmed by the recent reversal of the Supreme Court (SC), they want foreign mining TNCs to fully own and control our mineral resources and lands. This is an affront to our national sovereignty and transgresses over the exclusive right of the Filipino people to exploit, utilize and develop our national patrimony such as our mineral resources.

The Arroyo administration is pushing hard to promote its mining liberalization scheme, as though it is a tried and tested formula for economic development. We have been in this situation before. From the start of the direct colonial rule of the United States in 1900 until 1974, when the Parity Amendment expired, foreign individuals and corporations were 100 percent allowed to participate not only in mining but to all economic sectors and activity in the country. In 1971, of the top 17 mining corporations, 5 were American-owned. These five mining firms accounted for 75 percent of the total sales, income and equity of the top mining companies.

Yet, these have not freed the Filipinos from poverty. Neither has this brought industrialization to the country. Did these ensure the protection of our environment and prevention of man-made calamities such as landslides and flashfloods?

History and the present situation of the mining industry tell us they did not. The abject condition of the Filipino people and the degraded state of our environment attest to the ultimate objective of an export-oriented and foreign investment-driven mineral industry -- sheer plunder and profit for foreign mining corporations and their local cohorts.

Up to now the government continues to brush aside and resist the call of the people to nationalize and develop our mining industry within the framework of genuine national industrialization and development. A truly just, sustainable and prosperous mining industry serves the needs and demands of the people and of the development of the environment and not the vagaries and interests of foreign capitalists.

Now that prices of metal in the international market is back on the up trend, mining TNCs and their local cohorts are drooling as this is an opportune time again to rake in billions of profit. On the other hand, this will fire up the people's ire against the Arroyo administration and further strengthen and widen their struggle to defend their rights, land and environment against foreign transgression and plunder.