FOR ECONOMY | Duterte allows government to enter new mining agreements after lifting ban

April 15, 2021 , 03:01 PM

(April 15, 2021) – President Rodrigo Duterte has lifted a moratorium prohibiting the government from signing new mining deals, hoping to usher in economic growth to reverse the impacts of the COVID-19 pandemic.

Duterte signed Executive Order (EO) 130 on Wednesday, reversing a portion of an earlier directive issued by former President Noynoy Aquino in 2012, which banned new mining applications until the signing of a new law modifying revenue-sharing schemes. It essentially allows the government to ink new mineral deals and review existing agreements to possibly renegotiate existing terms.

No law has been passed over the past nine years to fulfill the stipulated condition in the previous order. Both the Department of Environment and Natural Resources (DENR) and the Department of Finance (DOF) have a huge role in carrying out Duterte’s new EO.

“The DENR shall formulate the terms and conditions in the new mineral agreements that will maximize government revenues and share from production, including the possibility of declaring these areas as mineral reservations to obtain appropriate royalties, in accordance with existing laws, rules, and regulations,” a portion of EO 130 said.

Wilfredo Moncamo of the Mines and Geosciences Bureau (MGB) said the mining industry is “elated” that Duterte heeded the sector’s bid “to contribute to the economic recovery of the country.” He said some investors had been hesitant to invest given the need for a new mineral production sharing agreement (MPSA) as mandated under the previous order.

“(This) will authorize the mining company to proceed to development and commercial extraction. These are the activities or projects needed that can generate economic activities, revenues, employment, services, taxes, and other indirect economic activities in remote areas in the country,” said Moncamo, vowing to adhere to strict environmental guidelines.

Duterte insisted the country was only able to tap less than 5% of the country’s mineral resources. He said the country could gain so much more in mining projects following the approval of the tax reform law in 2018, which doubled the excise tax on minerals from 2% to 4%.

Mining issues have been controversial over recent years due to its reported impacts on the environment. Even Duterte repeatedly castigated mining firms for destroying the country’s waters and forests, but his words did not appear consistent with his actions.

Duterte’s recent moves are directly opposed to the stance of his former DENR secretary, the late Gina Lopez, who ordered to close down at least 26 mining operations in 2017. The following year, the government said 23 of these mining firms complied with environmental laws. It was also during that year when Duterte lifted a moratorium on new mining exploration.

Fisherfolk group Pamalakaya warned Duterte’s recent order could “spell doom” to the environment as it could allow “Chinese plunder” of the country’s mineral resources.

“The government would let foreign mining firms to exploit and plunder our mountains, forests, and seas with all their might while we beg for alms in the form of taxes and other duties in return. There are many other ways to keep the restore the economy without exposing our natural resources to big mining interests,” said Pamalakaya chairman Fernando Hicap. “This is a betrayal against the people who resisted destructive mining and until now continue to fight for their right to livelihood and environment protection.”

(Beatrice Puente/PM)

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