SC ruling on Mining Act jibes with Medium Term Dev’t Plan

The recent decision of the Supreme Court overturning an earlier ruling on the Mining Act falls within the purview of the Arroyo administration’s six-year Medium-Term Philippine Development Plan (MTPDP).

In a 246-page decision, the High Court overturned its decision that nullified the Philippine Mining Act as well as the financial and technical assistance agreement (FTAA) between the government and Western Mining Corp. Philippines, a wholly-owned subsidiary of Western Mining Corp. Holdings Ltd. of Australia.

Socioeconomic Planning Secretary and National Economic and Development Authority (NEDA) Romulo L. Neri said the decision "would open awindow of opportunity towards the ultimate revitalization of the local mining industry and the creation of thousands of new jobs for Filipinos."

Based on the MTPDP, the mining industry will be able to generate between $4 billion to $6 billion in investments, $5 billion to $7 billion in annual foreign exchange, and at least 240,000 new jobs in the next six years.

The SC said its decision would answer "the need to develop our stagnating the mining industry and extract what NEDA Secretary (Romulo) Neri estimates is some $840 billion worth of mineral wealth lying hidden in the ground, in order to jumpstart our floundering economy on the one hand, and on the other, the need to enhance our nationalistic aspirations, protect our indigenous communities, and prevent irreversible ecological damage."

"A policy decision to rebuild the mining industry would open its enormous economic potential," emphasized Neri, citing estimates of the country’s mineral wealth at about $800 billion to $1 trillion, as against the current Philippine external debt of $37 billion. The MTPDP identifies China, Australia, Canada and the United States as major players in a revived Philippine mining industry.

A statement from the American Chamber of Commerce of the Philippines indicated the court decision would help the government "create jobs, increase revenues from exports, and bring in needed foreign direct investments." Likewise, the Chamber of Mines of the Philippines had expressed its view the decision would draw support from the entire business community, locally and internationally.

"Mining has a multiplier effect of six times. At a potential value added of P300 billion annually, mining can add an incremental economic activity of P1.8 trillion or 36 percent of GDP," Neri noted.

The mining industry is critical in stabilizing the country’s macroeoconomy. It is expected to increase tax collection, reduce creditor risk perceptions and improve credit rating, which will reduce the interest foreign creditors charge the country for its loans. It is also expected to generate a substantial increase in exports and the country’s precarious level of foreign exchange reserves and strengthen and stabilize its currency.

Meanwhile, the NEDA likewise stressed that tourism plays a major role ingenerating much-needed income and revenues.

Speaking before participants to the National Meeting of the Philippine Councilors League (PCL) in Lahug, Cebu, NEDA Deputy Director General Augusto B. Santos expressed optimism over Cebu’s potentials as one of the country’s major destinations.