THE country’s economic managers expressed concern that the Department of Environment and Natural Resources’ decision to close down 21 mining companies could cost not only thousands of jobs but also hurt local government finances and the national economy.
Finance Secretary Carlos Dominguez said the closure of the mining companies will not only deprive jobs to thousands of people across the country but also affect the finances of local governments and also the national government.
“In Surigao alone, one company employs 10,000 people. That’s my primary concern—the impact on employment in these rural areas,” Dominguez said.
“My next concern is the impact on the local government finance because they pay a lot of taxes to the local governments. We are still assessing how different municipalities will be affected. We will check with local treasurers to give us a potential impact on the local communities,” Dominguez said.
On the national front, Dominguez said, the mining closures could lower the projected growth of gross domestic product.
As part of contingency planning, Dominguez said he already asked other members of the Cabinet if they have in place emergency employment programs to cushion the impact of job losses.
He said the Social Welfare and Development and Public Works and Highways are looking at emergency programs to create jobs, as are the Trade and Industry and Labor departments.
Duterte’s economic managers, however, have not reached a unified position on the mining issue, he said.
Dominguez said he has not yet spoken to President Duterte regarding the mine closures and said he might seek an audience with the chief executive.
Trade Secretary Ramon Lopez admitted Friday that the closure of 21 mining companies would hurt exports and the economy.
“Despite the small contribution to exports, the industry is still a dollar-earner,” he said.
The department is looking for ways to offset what will be lost if the mining companies are shut down, he said.
But Lopez also acknowledged that some companies were not following the government’s mining regulations.
“They need to level up, acquire technology that will allow them to do value-adding processes and refrain from exporting ore alone,” Lopez said.
He said the companies could be back in operations soon with a few adjustments to their systems and procedures.
The Chamber of Mines of the Philippines said Friday the government will lose about P 16.7-billion taxes annually once the 21 mining companies will be closed down and five others will be suspended.
In a press conference, chamber chairman Artemio Disini said a total of 1.2-million indirect and induced jobs are also at risk.
“The mining industry is found to have a multiplier effect of at least four depending on the location of the operations,” Disini said.
Some P66.6 billion in gross production value of large-scale mining operations will also be lost annually, the group said.
National Economic and Development Authority director-general Ernesto Pernia said his agency has not yet reached an official position on the mine closures.
“Ideally, it should be responsible mining but it’s easier said than done,” he said.
Bangko Sentral Deputy Governor Diwa Guinigundo said they would continue to monitor the potential impact of the mine closures.
“We have a very resilient economy and great potential capacity to grow beyond 7 percent. Infrastructure, both hard and soft, is therefore critical and the tax reform package should make this more manageable to navigate without blowing our fiscal space,” Guinigundo said.
Environment Secretary Regina Lopez announced Thursday that out of the 41 metallic mines in the country, 21 will be closed down, six companies will be suspended and only 12 passed a mining audit.
She drew support from President Rodrigo Duterte, who said he was elated by the decision to close 21 mining companies that failed the mining audit.
Also on Friday, two listed mining companies requested for a halt in the trading of their shares as they seek additional information about the closure and suspension orders.
Marcventures Holdings Inc. and Global Ferronickel Holdings Inc. both asked that the trading of their shares be suspended from Feb. 3 to Feb 6.
Marceventures’s unit Marcventures Mining and Development Corp. was among the 21 mining companies ordered for closure by Environment Department.
On the other hand, Global Ferronickel is still trying to get clarification from Environment Department if its unit Platinum Group Metals Corp. is also among the companies ordered for closure.
Presidential Spokesman Ernesto Abella said Friday that mining companies affected by the closure orders could still appeal the decision.
“The Duterte administration promotes inclusive prosperity and responsible mining–which means adhering to standards that are sensitive to environmental and social issues,” Abella said. With Jenniffer Austria and John Paolo Bencito
