Mining TNCs Rake in Huge Profits, Contributions to Economy Negligible

The Arroyo administration has been courting foreign mining corporations to invest in the country. It has repeatedly said that a revitalized mining industry will create more jobs and will boost the local economy. Facts and experience, however, prove otherwise.


The Philippines is among the world’s most mineral-rich areas, ranking third worldwide in gold reserves, fourth in copper, fifth in nickel, and sixth in chromite.

However, the country’s mining industry is dependent on foreign capital and technology, said Defend Patrimony!, an alliance of individuals and groups opposed to imperialist plunder, and Kalikasan-People’s Network for the Environment (KPNE). These groups maintained that the industry is controlled by foreign investors in partnership with local big business. Minerals are extracted to produce raw materials not for local industries but for export.

The Arroyo administration has identified 32 priority mining projects as of January this year – ten of which are by companies that are foreign-owned.

There are 294 mining agreements: two Financial and Technical Assistance Agreements (FTAAs), 262 Mineral Production Sharing Agreements (MPSA) and 30 Exploration Permits (EPs).

In the beginning of the year, there were 2,626 mining applications under process. The number of approved mining permits and agreements have increased by 18 percent, from only 431 in 2006 to 504 in 2007.

The KPNE and Defend Patrimony! enumerated the biggest mining projects, to include the Tampakan Copper Project (31,600 hectares) in South Cotabato, Amacan Copper Project (27,058 has.) in Compostela Valley, Nonoc Nickel Project (25,000 has.) in Surigao del Norte, Didipio Copper Project (21,465 has.) in Nueva Vizcaya, and Pujada Nickel Project (11,799 has) in Davao Oriental.


According to Defend Patrimony! and KPNE, mining has not produced a significant number of jobs that would create an impact on the employment situation in the country. From 2001 to 2008, the contribution of mining and quarrying to employment is only from 0.30 percent to 0.40 percent.

Employment in mining and quarrying

In 2007, the industry’s contribution to gross domestic product remains small, only 1.3 percent or P18 billion ($390,049,406 based on the 2007 average exchange rate of $1=P46.148).

Moreover, taxes collected by the government are measly compared to the profits earned by foreign mining companies, said Clemente Bautista, KPNE national coordinator. On the average, Bautista said, mining companies pay only six to seven percent of their total sales to the government.

Citing data from the Mines and Geosciences Bureau (MGB) Region V, Bautista said that Lafayette Mining Corporation paid only from 0.99 percent to 2.61 percent of its total sales as excise tax to the government.

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