Two countries; Yes to responsible mining

It is happening all the time.  When I read the day’s papers I feel that I am writing about two countries. One — that the economy is so bad, people cannot cope with the cost of transport, food, housing. At its most desperate level, the poor rummage garbage bags and cans looking for food to eat.  And the other is a country with the fastest growing economy in the region … so huge it beats China. It can be confusing.

Some do not want you to think it is confusing. They are sure that the economy is growing, that it will trickle down to the masses if only we can wait. While we wait scandals rock the country with multimillion scandals of corruption in a government that claims that there is no poverty if there is no corruption.

The trouble is that the corollary of that is also true — if there is poverty, there is corruption. Perhaps it is true. There are really two countries in the Philippines â€” one for the poor and one for the rich. We need to close the gap. For that we need good government with a vision.

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Working to be rich does not create poverty. It is those who do not work and become rich that is the problem. On the contrary, work should create wealth. But without a government that properly mediates, through regulatory bodies and an effective justice system between the two classes, the gap can only grow wider.

Several rich Philippine tycoons are already in the forefront of corporate social responsibility, among them George Ty. He has persuaded Toyota to establish a school for mechanics, etc. for the poor in the Philippines. Once they go through the course and training, they are immediately employable whether in the Philippines or elsewhere. I am sure there are others.

Another tycoon that comes to mind is the self-made Manny V. Pangilinan, or MVP who now controls Meralco. He has converted  what used to be the Lopez luxury house in Antipolo into a place for advanced studies in business and economics through seminars and lectures. These are just two examples.

It may be more useful that instead of having league tables on the richest men (even if it comes from Forbes) in the Philippines, to start a league table of Philippine corporations on corporate social responsibility. That would create an entirely new atmosphere for doing business is rated through generosity rather than greed.

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There is indeed a book that not only rejects the notion of enmity between the rich and the poor but comes up with the startling proposition that there is a fortune at the bottom of the pyramid. It was published some years ago entitled The Fortune at the Bottom of the Pyramid, by C.K. Prahalad. I have kept it ever since. He argues that there is money to be made by selling to the world’s poorest. And it is not just about goods but as a business philosophy that embraces anything it takes that can close the gap between the rich and the poor.

The basis of his argument rests on an accepted fact — the bottom of the pyramid ie the poor, because of its sheer size — some four billion people is the biggest market in the world. It is not adequately tapped because it is presumed that with no money the poor cannot be a viable market.

“The dominant assumption is that the poor do not have money to spend and, therefore, are not a viable market. Certainly, the buying power for those earning less than $2 per day cannot be compared with the purchasing power of individuals in the developed nations. However, by virtue of their numbers, the poor represent a significant latent purchasing power that must be unlocked,” writes Pralahad. But businesses catering to these markets require creative minds and the will to implement strategies.

It is the opposite of conditional cash transfers that can be a bureaucratic nightmare and an invitation to graft. Moreover it creates a culture of dependency.  Businesses for the bottom of the pyramid is about giving people the pride of their labor and the freedom to decide.

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It is sad that once again there are voices being raised against Tampakan, with the same tired reasons from people who are not even from the area through a change.org petition in social media.

 The project is about the development of a copper mining site that could be one be one of the largest in the world. The returns of its development are enormous and can be considered a primary source of revenue for the entire country.

Critics often forget that in big mining such as Tampakan it is a joint venture between government and foreign investments. The potential wealth for the Philippines is huge but we need big capital (which we do not have) to mine responsibly precisely because there are environmental requirements. In Tampakan Xstrata Copper, its Philippine contractor –SMI Philippines and the Philippine government are partners on behalf of the people.

This concept of being a joint venture is often misunderstood. People think it that is merely a foreign investment by an outsider taking advantage of our resources.

The ban on open pit mining was issued by the local government of South Cotabato. The ban ignored assurances it would follow sound environmental practices and approved by the national government through an ECC.

There are dozens of examples around the world where what used to be open pit mining sites have been transformed into parks and gardens. 

I have gone to the area and talked with the residents there and they are aghast at how outsiders usurp their right to speak for themselves.

The latest attacks on the project come from an independent Human Rights Impact Assessment (HRIA) on Tampakan conducted by the Institute for Development and Peace (INEF) which is a group based in Germany.  The thrust of their criticism should be directed to government neglect and inaction on human rights and not on SMI.

 I think it will be best if the INEP data and the situation on the ground could be compared periodically instead of giving a blanket refusal to a project that is helping the poor in Tampakan. Again let the poor speak for themselves on what is happening there. Before mining  came to Tampakan it was a god-forsaken area with no schools, hospitals or livelihood for those who live there.