The discordant melody of mining (Conclusion)

Three global developments compel us to analyze the Phillippines mining industry against the traditional exploitive imagery that the sector is arrayed against where perceived negativity reigns due to persistent misconceptions.

These paint local mining in a different light and, perhaps, should we analyze and submit to altering long-held paradigms, we might better understand the industry’s role in development much in the same manner that large-scale corporate mining had been an indispensable industrial catalyst among First World nations.

Among the minerals and metals we mine, perhaps our most prolific, where major investments are plunked in unprocessed, nickel ore is probably our most viable.

Coincidentally, our nickel mines are likewise our best showcases where modern mining technology is not only the most advanced, but it is also here where the most direct capital investments are concentrated.

Set against the recent decision of Indonesia to export only processed products, the Philippines nickel industry is experiencing not only increased demand, but it is faced with a golden opportunity to prove how critical mining can be to local development as a significant contributor to gross domestic productivity.

Such market developments conveniently allow us to segue into the other latent global development that ratchets the local mining industry up several notches, catalyzes and moves us up in the global mining supply chain.

The rapid industrialization of China remains in full swing and its appetite for raw nickel ore for a myriad of metallic products, from miniature electronics, electrical wiring and energy usages, to humongous railroad rolling stock that not only uses nickel developed from raw ore will remain a staple of the Chinese economy.

Factor into the global demand for metals the increasing industrialization of all of the Asian economies that encircle us and the prospect of the Philippines mining industry, as a major supplier cannot be underestimated.

The third global development, which uncannily benefits our major local nickel mines, is the increasing need for social responsibility and environmental consciousness among global quality organizations.

In this regard, the Philippines’s large-scale, highly capitalized and transnationally structured nickel mining companies have a distinct edge.

Noting that negative perceptions on the whole mining endeavor are constantly fomented in the media, let us see how these recent developments have actually played out. Let’s look at the empirical data and see where mining’s contributions to micro- and macro-economic development lie.

Of these global developments two have been on-going for more than half a decade. Asia is on an industrialization binge, and modernization and infrastructure development in other countries are priorities. Indeed, the insatiable appetite for nickel and other metals by China and our Asian neighbors has been driving demand.

In tandem, however, so has the environmental aspect been tempering development so that the contribution of Philippines mining to macro-economic development is both rationalized and optimized.

World Bank data, as well as research from Unctad, has shown that among 20 global economies, the Philippines, up to 2010, prior to the Aquino administration’s de-facto policy of a freeze on mining, recorded the highest and most significant production value with increases in value, besting even the United States, Australia and Canada combined.

Furthermore, under a recent international assessment of global trade covering that same period the data “confirm the proposition that insofar as production and income generation are critical forces in poverty reduction, mining has an increasingly significant role to play.”

It is unfortunate that the mining sector players have known this all along, while the reality continues to elude the Aquino administration and the media-conditioned public.

The key to understanding and enlightenment is to analyze mining’s economic contribution along the whole spectrum of the value chain. Not just on its tax and employment impact, as government would have it, but comprehensively throughout the multiplier wave. Only then can we reconcile the discordance and start hearing what should be music to our ears.