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Revived Philippine Mining Activity Renews Debate Over Jobs and Environment

Mining activity is picking up in the Philippines as global metal prices soar, driven by demand for raw materials from the expanding Chinese economy. The development has revived the debate over the environmental and social impact of mining.

Industry officials say gold, silver, copper and other valuable metals can help reduce poverty and improve people's lives. But environmentalists and others argue that mining only lines the pockets of the wealthy, exploits the poor and damages the environment.

The Philippines is located in what geologists call the "Ring of Fire" - the volcanic belt of the Pacific basin that is rich in mineral deposits. Philippine mining authorities say the country is ranked in the top five worldwide in copper, nickel, and gold resources per square kilometer. They estimate that existing mining projects in the island nation are worth at least $90 billion.

Mining officials say existing mine properties are increasingly being tapped in the Philippines, and new exploration is expanding in areas where no minerals were previously found.

Driving this is China, which is soaking up minerals such as copper and nickel to fuel its economic growth.

The Chamber of Mines of the Philippines says the impoverished country is in a good position to profit from China's growth.

"The Philippine mining industry will provide a catalyst for growth for the Philippine economy primarily in rural areas of the Philippines where poverty is at its height," said Benjamin Philip Romualdez, who heads the chamber. "The Philippines needs drivers for growth, catalysts for growth, and the mining industry being a principle part of that, simply because the mining resources of the Philippines are one of the richest in the world."

For years, big foreign companies were reluctant to open new mines in the Philippines, because of a legal challenge to a 1995 law that allowed them to own mines. In 2004, the Supreme Court threw out the challenge, making companies more confident about investing.

Romualdez says that for every one job created directly by mines, between four and 10 jobs are created in related industries such as construction, materials, supplies, and services. Companies also build roads and other infrastructure to reach mines, which often benefit isolated communities.

Many people think the country desperately needs more mining operations. Despite having vast natural resources and a highly literate population, the Philippines is one of the poorest countries in Asia. It has an unemployment rate of over 11 percent, and about eight million Filipinos have gone overseas to find jobs.

But others say mines do more damage than good for the poor communities surrounding them. Mines, critics say, cause pollution and can contribute to problems such as deforestation and floods.

Last month, the Rapu-Rapu project, partly owned by the Australian mining company Lafayette, was fined about 200 thousand dollars for leaks of cyanide, a chemical used in mining. In the mid-1990s there was a devastating spill of mine waste at an unused copper mine on Marinduque island.

In addition, there has been extensive small-scale mining by thousands of individual prospectors over the decades. Industry officials and environmentalists say such operations are prone to abuses and employ dangerous and wasteful methods.

Environmentalists are wary about the growth of big mining operations. Aside from the risk of environmental damage, they say the profits earned from mines do not get to the people living near them.

Jukka Holopainen, the president of the Center for Environmental Awareness and Education in Quezon City, says mining operations date back to the early 20th century, when the United States ruled the country.

"We've already been mined for 100 years, since the time of the Americans actually. And, it's very simple, if you look at all the project sites where there has been mining, most of the people who have lived in these mining sites are still [in] fourth class provinces, are still desperately poor," said Holopainen.

The matter has become such a hot topic that the Catholic Church, a powerful institution in the Philippines, has entered the debate. The Catholic Bishops Conference in January condemned mining, saying it destroys life and has damaging effects.

"Mining gives death. It removes life, deprives us of our resources, polluting our rivers, polluting our sea," said Bishop Arturo Bastes, who is based in Sorsogon, near a major mining project. "We might have some few dollars, but those dollars cannot compensate for the suffering of our people. And who benefits from mining? Not our people but some few rich men."

The bishops asked the government to cancel mining concessions and deny all applications. They also want Manila to repeal the law that allows foreign companies to own mines.

Despite the controversy, mining companies and their backers say well-run projects help poor communities.

Canadian mining company TVI Pacific employs about 650 people in Canatuan, a remote area in the southern Philippines, where slash-and-burn farmers once operated. John Ridsel, TVI corporate affairs adviser, says the company has done much for the area.

"We've helped in the construction of schools, we employed teachers, we put up a clinic, we bring doctors in, we're giving training in livelihood, we've been a catalyst for the establishment of a women's group, which is spectacularly raising consciousness of women on the empowerment side," he said.

Ridsel says TVI planted 50,000 trees last year near the project to reforest areas cleared by slash-and-burn farming, prevent erosion around roads and other areas, and to repair damage done by the small, independent miners who worked the area previously. In addition, his company pays one percent of its gross revenue to the community.

A spokesman for President Gloria Arroyo said the government has no plans to revoke concessions or move to change the mining law. The president has said mining has the potential to improve lives in the rural Philippines. Although some opposition politicians have indicated they want the mining policy reconsidered, the government says it will continue to promote industry.