Let’s stop kidding ourselves

Another example of how someone can look at the proverbial glass as either half-empty or as half-full.

The Revenue Watch Institute (RWI), a US-based non-government organization,  recently ranked the Philippines 23rd among 58 countries surveyed in terms of how the country regulates extractive industries such as oil, gas and mining.

RWI’s Resource Governance Index or RGI is an annual report that measures the quality of governance in the oil, gas and mining sectors of different countries in a bid to help identify good practices as well as governance shortcomings.

Based on the RGI, the Philippines ranked 23rd among 58 countries surveyed in terms of four components, namely: institutional and legal setting, safeguards and quality controls, reporting practices, and enabling environment.

But while our government rejoiced and made a big fuss about the country being at the top half of the list, some sectors have noted that the Philippines had a composite score of 53 out of 100 or only four points above the weak performance category. In fact even the RWI noted that the current country scores indicate a striking governance deficit in natural resource management worldwide.

The Philippines’ lowest score was in the enabling environment component, with only 46 out of 100 points. This, it has been noted, is equated to a weak performance due to failing marks in upholding the rule of law and controlling corruption

According to the Chamber of Mines of the Philippines, while the Philippines did rank in the upper half of the 58 countries surveyed in the RGI, leading RWI to say that the government has “made meaningful progress toward improved resource governance”, the country’s low component scores indicate its governance of the extractive industries leaves much room for improvement.

Here are other observations made by CMP.

“In one of its seven-point recommendations to manage governance and transparency deficits in state-owned companies, RWI mentioned the Philippines along with Mongolia and Vietnam, saying SOCs in these countries “play a central role and should adopt more assertive reporting requirements and anti-corruption policies.

“The Philippines is among nine of the 10 countries in the RGI that received less than satisfactory scores” in addressing the broader governance environment by controlling corruption and strengthening the rule of law, RWI added in its recommendations.

“Even in the two other component categories of reporting practices and safeguards and quality controls, the Philippines received below satisfactory marks: 54 out of 100 and 51 out of 100, respectively.

“RWI translates the numerical score of a country in the RGI Index into four performance ranges: Satisfactory (71 to 100), Partial (51 to 70), Weak (41 to 50), and Failing (0 to 40). So in the four component categories of the Index, the Philippines actually did not get any satisfactory score, and in fact is ‘failing’ in the ‘enabling environment’ component.

“While the DENR should be lauded for implementing the government’s revenue transparency initiatives under Executive Order No. 79, it is premature for the department to celebrate the country’s mediocre ranking in the Resource Governance Index. A lot more needs to be done to improve the enabling environment for the Philippine extractive industry in general, and particularly with respect to the investment environment and in respecting the sanctity of contracts.”

It is admirable that despite the not-so-welcome treatment that they have received from our government, both national and local alike, mining companies like Philex and Sagittarius Mines continue to have faith in our country. They could have channelled their money elsewhere but they have decided to stay.

It is about time that our government learn how more successful countries in the extractive industry like Australia have managed to balance wealth and the environment. We cannot continue to pretend that we know everything.

Not so hidden agenda

The External Trade Development Corp. (MATRADE) is organizing International Trade Malaysia 2013 (INTRADE), the 7th Malaysia International Event for Exporters. INTRADE is the annual global trade and export exhibition purposed to enhance networking, business matching, exchange of ideas and knowledge amongst the business communities from different countries.

The three-day exhibition will be held from the 26th to the 28th of November 2013, at Menara MATRADE, Kuala Lumpur, Malaysia. With last year’s excellent record of participation, INTRADE 2013 expects to host 450 exhibitors from 15 countries, 300 trade buyers from 30 countries and anticipates 9,000 local and international trade visitors during the event.

INTRADE 2013 will continue to highlight four main industry clusters that stimulate the economic growth and provide business opportunities, namely Building Materials; Electrical & Electronics and Information & Communication Technology (E&E and ICT); Lifestyle; Manufacturing Support. Each of the four clusters is a strong contributor to the world’s economy and possesses positive growth potential.

Themed “Revitalising Export Growth”, INTRADE 2013 wants to express the importance of rejuvenating export opportunities in the current situation of heightened competition and concerns in the global economy.

Export-ready companies are invited to take part as an exhibitor at INTRADE 2013. Through this event, exhibitors are offered an ideal platform to launch and market new products and services, explore new markets on a global level, develop key business alliances, strategically position and grow their businesses, as well as raise the company’s profile in the international market, and ultimately export to ready consumers.

For further details on INTRADE 2013, you can visit the official website at www.intrademalaysia.my or contact: Embassy of Malaysia Trade Office (MATRADE) Manila through email at [email protected] or  through telephone at +632.5568645.  

For comments, e-mail at [email protected].