New York group cites PH progress in mining management, legislation

MANILA, Philippines — A New York-based policy institute has said that the country’s management of its mineral resources has made “meaningful progress” and ranked the Philippines 23rd among 58 nations in its latest resource governance index.

The Department of Environment and Natural Resources (DENR) welcomed the country’s ranking in the 2013 Resource Governance Index by the Revenue Watch Institute (RWI), in terms of institutional and legal initiatives, which it said indicated better management by the government of the country’s mineral resources.

In its report, the RWI gave the Philippines a score of 63 out of 100 under the institutional and legal category, its highest on any component, as a result of the country’s “comprehensive mining legislation.”

RWI aims to promote effective, transparent and accountable resource management through the resource governance index, which measures the quality of governance in the oil, gas and mining sectors of 58 selected countries. The Philippines was particularly included for its mineral resources, having produced 11 percent of the world’s nickel in 2010.

According to the RWI study, the Philippines ranked in the top half of countries surveyed in terms of the institutional and legal setting, reporting practices, safeguards and quality controls, and enabling environment, “suggesting that the government has made meaningful progress toward improved resource governance.” Norway, United States and United Kingdom topped the survey.

The policy institute further noted the Aquino administration’s transparency, observing that the government has been providing more information than its predecessors. It particularly cited the posting of the maps of licensing areas online and the public’s access to copies of contracts, upon the filing of a request at the Mines and Geosciences Bureau (MGB).

RWI also said that the MGB has been regularly publishing information on mineral reserves, production, investments, approved operations and disaggregated revenues. The Bureau of Internal Revenue reports annual tax data while the DENR publishes royalty receipts, according to the RWI.

In a statement, Environment Secretary Ramon Paje said that the positive RWI assessment could be attributed to the Aquino administration’s initiatives on reforms in the mining sector.

Paje cited President Aquino’s Executive Order 79, which has sought to balance environmental protection and responsible mining with a more equitable revenue-sharing scheme and has provided coordinative mechanisms among stakeholders including local government units.

“The international community has noted the comprehensiveness of our mining laws and how they facilitate transparency, accountability and open or fair competition,” the environment secretary said.

He added, “This is indirectly a recognition that the issuance of EO 79 by President Aquino was indeed the perfect vehicle to reform the mining industry and improve government royalty rates while at the same time ensuring intergenerational equity.”

EO 79 bans mining in prime agricultural and fishing areas as well as in 78 designated ecotourism sites, particularly in Palawan. It prohibits the issuance of new mining permits until a law increasing the royalty tax imposed on the gross earnings of mining companies from two to five percent is passed.

The executive order also calls for a review of existing mining operations to ensure they comply with mining and environmental laws and emphasizes the need to harmonize national laws with ordinances to ensure the proper management of and regulation in the industry.

Apart from being a major international source of nickel, the country’s rich mineral resources also include major copper deposits, chromium, gold, and silver, which made up eight percent of merchandise exports in 2011.