With the recent pronouncements of the newly appointed Presidential Adviser on Investment and Economic Affairs, Frederick Go, that mining is at the top of the government’s list of five priority areas [the other four being semiconductors, agriculture, steel, and pharmaceutical industries], expectations are high that this administration will finally deliver on its promise to revitalize the mining industry.
One step in this direction was the signing last November of a Memorandum of Understanding for Sustainable Development and Investment in Mineral Extraction and Processing among the concerned government agencies and private organizations.
Among them are the Anti-Red Tape Authority (ARTA) represented by Secretary Ernesto V. Perez, the Department of Environment and Natural Resources (DENR) represented by Secretary Maria Antonia Yulo-Loyzaga, Department of Trade and Industry (DTI) represented by Undersecretary Ceferino Rodolfo, Department of the Interior and Local Government (DILG) represented by Undersecretary Marlo L. Iringan, Department of Finance (DOF) represented by Undersecretary Karlo Fermin Adriano, and University of the Philippines Public Administration Research and Extension Service Foundation, Inc. (UPPAF) represented by the Chief of Party of the Regulatory Reform Support Program for National Development (RESPOND) Project, Dr. Enrico Basilio.
The signing was held at the United States Embassy Residence, Scout Hill, Camp John Hay, Baguio City, on the sidelines of the Philippine Mine Safety and Environment Association’s Annual National Mine Safety and Environment Conference.
This initiative was led by the UPPAF under the RESPOND Project, which is supported by the United States Agency for International Development (USAID) and the United States Trade and Development Agency (USTDA).
The MOU aims to maximize the huge potential of the mining sector in the country through a more responsible, sustainable, and inclusive exploration, development, and utilization of mineral resources to catalyze socio-economic growth.
Under the MOU, technical assistance will be extended to key government agencies in the areas of pursuing extractive policy reforms, drafting a sound mining taxation framework, conducting capacity-building sessions, and taking a whole-of-community approach to ensuring the active participation of various stakeholders in the pursuit of mineral extraction activities.
ARTA, as a key agency in implementing Republic Act No. 11032, or the Ease of Doing Business and Efficient Government Service Delivery (EODB EGSD) Act of 2018, will collaborate with UPPAF-RESPOND in streamlining and re-engineering the business permitting and licensing system of DENR’s regulatory agencies, particularly the Mines and Geosciences Bureau.
There is no question that the Philippines is highly mineralized. The global demand for critical minerals should also push the country to the forefront as a source for these. However, whether is actually attractive to investors is another story, as we continue to be our own worst enemy due to, among others, policy shifts and the difficulty in doing business.
One only must look at the Global Competitiveness Index for 2023, where the Philippines was ranked 52nd in a list of 64 countries, falling four spots from 48th place in 2022.
The report ranks countries using 255 criteria spread across four competitiveness factors: economic performance, government efficiency, business efficiency, and infrastructure. In the case of the Philippines, it declined in three out of four main factors or dimensions of competitiveness.
In particular, the country’s business efficiency factor fell from 39th in 2022 to 40th in 2023, while its infrastructure factor, which has been a perennial challenge for the Philippines, also dropped from 57th in 2022 to 58th in 2023.
In the World Bank’s Ease of Doing Business Index, the Philippines ranks 95th, compared to the leaders New Zealand and Singapore, which are ranked 1 and 2, respectively. According to the World Bank, a high ease of doing business ranking means the regulatory environment is more conducive to the starting and operation of a local firm. Conversely, the farther a country is from number one, the harder it is to do business in that country.
By the time this issue comes out, the DENR would have convened (or be close to convening) a Mining Summit bringing together the industry’s stakeholders to discuss the issues that continue to stymie mining in the Philippines. While issues like the mining fiscal regime will surely be high on the agenda, it is hoped that equal time will be devoted to more basic issues like red tape and the lack of coordination among the government departments and agencies that deal with mining.
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In February, I had the pleasure of emceeing two mining events: first was a webinar organized by the Embassy of Canada in the Philippines entitled “Digging Deeper: Innovations and Opportunities in the Philippine Mining Sector”; and second was a seminar jointly organized by the Philippine Mining Club and Yokogawa with the theme “Powering a Sustainable and Resilient Mining Industry.”
The Canadian Embassy event was participated in by Canadian mining companies, equipment/ technology suppliers, and other prospective investors.
The PMC-Yokogawa event, on the other hand, highlighted, among others, how technology may aid companies in meeting their ESG objectives. One such example is Yokogawa’s Carbon Footprint Tracer, which was launched just days before.
Patricia A. O. Bunye is a Senior Partner at Cruz Marcelo & Tenefrancia where she heads its Mining & Natural Resources Department and Energy practice group. She is also the Founding President of Diwata-Women in Resource Development, Inc., a non-government organization advocating the responsible development of the Philippines’ wealth in resources, principally through industries such as mining, oil and gas, quarrying, and other mineral resources from the earth for processing.
