RP fast becoming a mining haven; P620-B investments seen

Written by Jonathan Mayuga / Correspondent

Wednesday, 15 September 2010 12:24

THE Philippines is fast-becoming a “mining haven” with $14 billion (P619.64 billion) in projected investments from 2009 to 2015 and $11.1 billion (P491.29 billion) in annual revenues starting 2017, according to Sergio R. Ortiz-Luis Jr., president of the Philippine Exporters Federation (PEF). He revealed this in his keynote speech at the Mining Philippines 2010 Conference and Exhibit at the Manila Hotel on Wednesday. Around 250 government and mining executives attended the conference. The Philippines ranks No. 4 in gold, No. 6 in copper, and No. 7 in nickel in the world “with these minerals valued at a hefty $840 billion,” he said, and buoying the industry now are soaring ore prices, cheap capital, and a more investor-friendly regime under the new administration. He said the Bicol and Caraga regions, where such minerals are heavily concentrated, stand to benefit, especially with metals-hungry China positioning itself to be a major buyer and investment partner. But Ortiz-Luis cautioned against committing the same mistakes that the country did with foreign partners in logging ventures in the past. “Our sights should go beyond near-term goals but, more important, ensure that our natural resources are sustainably explored and processed for future generations to also benefit,” he said.  “There are other recurring issues that provide undue harassment and delays in conducting responsibly profitable mining in the country for its thousands of stakeholders such as unstable and unpredictable policies, tedious permitting procedures, environment concerns, increasing cost of doing business, and labor productivity,” he said. The PEF official also noted: “Growth has been painfully slow because the country has so far failed to build a strong industrial base. We cannot even claim yet that ours is now an industrializing economy. If we look at the numbers, we will find that our biggest sector is now services, second is agriculture. Manufacturing and Industry is the poor third in terms of its share in the number of people if employs and its share on the total value of goods and services every year.” A 2005 study commissioned by the Asean Secretariat, he said, confirms China’s continued economic growth would be one of the key drivers of world metals consumption in the coming years, with the Philippines being eyed as a major supplier of such. He said in the medium term, China’s consumption of all mineral commodities is expected to grow well above the average world growth rates with the study expecting annual growth of more than 10 percent in China’s consumption of nickel, tin and zinc, and aluminum and copper forecast to grow by 9 percent up to this year also in China.  “The strong demand for minerals in China can be expected to provide significant opportunities for minerals producers worldwide,” he said and that “the Philippine investment climate is crucial in determining whether it can actually capitalize on such opportunities.” This is because the global market for minerals has become very competitive and the presence of mineral deposits in a particular country usually requires more than available investment funds to launch minerals projects. “We know that global development and investment funds are drying up and so this is one other issue that needs to be addressed.” He said the Export Development Council’s fearless forecast is that the world mining industry would pull off a 20-percent growth for the whole of 2010. “If we do our homework, we may drive exports to levels approximating those in 2007 by the end of the year.”