Rough Times Continue For Mining In PHL

The New President of the Philippines, Rodrigo Duterte, has wasted no time following through on his campaign pledge to rid the country of drugs and drug-crime.

He has instructed the police to go after all criminals and politicians engaged in this illegal industry and prosecute with the full force of the law or the gun.  It is working.  But the collateral damage among the population is beginning to be felt such that the Philippines Senate has called for the rule of law to be applied to ensure that this war on drugs does not do more damage than good.

The new Secretary of the Department of Environment and Natural Resources, Ms Gina Lopez, has initiated a similar purge against people engaged in the mining industry who go about their business illegally or who cause unnecessary damage to the environment or the livelihoods of others in agriculture and other industries.

But it too is having unintended consequences.  A rapid round of audits has targeted a range of producers.  Those who have been deemed to have not complied with the law have been summarily shut down.  No trial, no chance to correct issues, no chance to defend or explain performance – just shut down.

This is an uneasy parallel with what’s happening in the war against drugs.  But under the law of the Philippines, due process must be done and be seen to be done.

Mining companies who have legitimately obtained licences and are complying with the law should be afforded the opportunity to demonstrate compliance – look back at all their filed reports, look at all the previous government agency audits, look at their capital market and public reportings and go see what’s on the ground.  Talk to the employees, the local community and the owners.  Build a sensible holistic view of the operation and then rationally discuss the issues with the owners and agree a plan to address the perceived and actual non-compliance issues.  Don’t just issue a stop order.  To do so threatens the livelihoods of every employee, every family of the employees and every other person in those communities who operate shops and support businesses.  Economic poverty will result from unnecessary closures and ‘stop’ orders.

Over 230,000 people are directly employed by mining in the Philippines.  When you include their family members, this is more like over a million people being fed and living life, thanks to the mining industry.  When you add a sensible economic acceleration factor of say 5, that means that over 5 million people in the Philippines live life in and around and because of mining.  That needs to be protected and supported, not unjustly terminated.

Illegal operators on the other hand must be shut down.  These people have no approvals to mine.  They use unsafe techniques, injuring and killing many mine workers every year.  They use poisons such as mercury, affecting the health of whole communities.  They care not for the environment and pay no taxes.  The gold and other precious metals they mine are sold cheaply to middle-men who pay no taxes, reinforce poverty among the small mine workers, and steal the gain and smuggle the goods away from the Philippines and its people.  This must end. 

The drive to mine better and to achieve an international standard of responsible mining is the right way to go.  Enforcement of high standards through only having approved operators conduct and manage mining, to high international standards such as in Australia, Canada and Chile and regularly auditing performance to ensure safe operations, high standards of environmental performance and close cooperation to the benefit of local communities, and paying full taxes under the law is essential for a healthy industry and a thankful community.

Allow the Philippine Mining Law and its regulations to work as intended.  Insist on full compliance with the law and performance to high standards.  But there are some essentially sound operations that need help to improve.  Help is close at hand from the world’s mining engineering and consulting sector.  There are global experts that can assist these companies and assist the government to develop a truly world-class industry here, to match the truly world-class deposits that are here in abundance.

These firms are in Australia, Canada and the USA.  They have people all around the world helping mines do better every day.  Their experts cover every field – from geology to mining engineering, metallurgy and mineral processing, environmental management and social engagement.  They are available now to help deliver a world-class mining industry for the benefit of all Filipinos.  Let’s take the chance not just to shut down the bad, but to encourage and guide the good into best mining practice.

 

Neil Grimes | Manila, August 2016

Neil Grimes is the Vice President for Victoria of the Australia-Philippines Business Council, and heads its Mining Committee.  He is also Managing Director of Mannerim Capital, and Australian-based management consultancy.  He has more than 25 years of experience in the mining industry around the globe.

 

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