MAC/20: Mines and Communities

From gold to dust

Published by MAC on 2005-11-30

From gold to dust

The Manila Times Editorial

30th November 2005

Trouble is brewing in the Philippines' gold-rush towns, threatening to undermine the government-led mining revival in a country that desperately needs the foreign investments to tap vast mineral reserves and generate revenues aimed at plugging a fiscal gap and bringing down poverty and unemployment levels.

Last week the local government hosting Lafayette's operations announced it would seek Malacañan's intervention to put a stop to the foreign mining firm's activities in the island-town of Rapu-Rapu in Albay province. The province's league of mayors backed up the island-town chief, asking the Department of Environment and Natural Resources to revoke the mining permit of the first and so far biggest foreign firm to take advantage of a Supreme Court ruling that allowed full foreign ownership of mining ventures.

The Rapu-Rapu council, which earlier endorsed Lafayette's operations, cried bad faith, because the mining company allegedly pushed on with its operations despite the absence of ample facilities to contain mine tailings. Initial findings by the Environment Management Bureau showed Lafayette's dam gave in to the sheer volume of the pollution it generated, thus forcing workers to divert the effluents and contaminate the surrounding bodies of water. Within days of the Rapu-Rapu mayor's turnaround, the Marinduque provincial government announced that it passed a resolution banning foreign mining for the next half-century. This resolution is the latest move of the same LGU that months ago filed a lawsuit before a US court against Placer Dome for fleeing the country before it could complete the rehabilitation of the Philippines' once biggest copper mine.

Indeed, what previously was a faint rumbling from the margins by a hard-line antimining minority is turning into a resurgent grassroots opposition to the country's mining revival. It is the much-feared rude awakening that comes after a spiel of too-good-to-be-true promises of prosperity for all.

Only a few months ago the Philippines hosted a Southeast Asian mining summit, which touted the country as the region's new mining haven. Foreign firms pledged investments running to the hundred millions of dollars, and set their sights on the potential returns from neighboring China's insatiable desire for minerals.

The Philippines boasts as much as a trillion dollars in mineral deposits, which if extracted could generate 240,000 jobs and address an unemployment problem considered the highest in Asia. A mining boom could generate 5 billion to 7 billion in excise-tax revenues alone, allowing the government to keep its budget deficit below a P120-billion ceiling next year.

The growing opposition to foreign mining aroused by the Rapu-Rapu incident may abort all of that, especially if the government behaves as if it were business as usual. The LGU-led opposition may snowball into a national campaign to stop the country's mining revival dead in its tracks.

Almost a month ago, we warned about the consequences of government mishandling the negative externalities of a mining boom. That warning was brought about by a cave-in that left a number of miners dead in another gold-rush town at the Mount Diwalwal area.

Much to our dismay, the environment secretary back then quickly blamed the cave-in on illegal mining in Monkayo town in Mindanao.

To its credit, the DENR has taken a more responsible tack in dealing with the Rapu-Rapu incident. It has suspended Lafayette's operations, and has organized a multisector, fact-finding team to look into the mine tailings spill.

But the task of governance has just begun. The more meticulous and complex job of pinning liability, ensuring compensation and preventing future accidents has yet to be done.

Unfortunately for the government, the stakes are higher this time around. The Rapu-Rapu and Marinduque local officials are making sure of that.

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