Save Palawan Movement - Dialogue With Business Community - Rockwell 1
SAVE PALAWAN MOVEMENT Dialogue with B i Di l g ith Business C Community R k ll I it Rockwell May 9, 2011 Ch i i S M d Christian S. Monsod
OUR ADVOCACY We are advocating a ban on mining in: Island ecosystems Biodiversity sites Bi di it it Watersheds Agricultural area Of which PALAWAN is a prime example
OUR ADVOCACY CONT D ADVOCACY…. CONT’DWe are not advocating a total ban onmining.Mining may have a role in ourdevelopment, although that has NOThappened to date, not even during themining “boom” of the seventies and the boomearly eighties
WHY PALAWAN? g y Palawan is a fragile island ecosystem with coral reefs, mangroves, farmlands, watersheds and old growth forests The economic, environmental and social , benefits of not mining far exceed the benefits There is a better business model – ecotourism as proven by Puerto Princesa p y
WHY PALAWAN PALAWAN……… CONT’D CONT D Over the longer term, the carbon stock of Palawan represents a win-win solution with carbon trading. The carbon stock of Palawan, is estimated by the Palawan Council for Sustainable Development at P130 trillion or more than twice the value of all the mineral lodes of the country of about P47-P60 e a odes o t e cou t y o 60 trillion ($840b -$1.4 trillion as estimated by the Foreign Chambers of Commerce) g
OUR ADVOCACY NO. 2. WITH RESPECT TOMINING IN ALLOWED AREAS…. The p j j projects must be subjected to strict standards of resource and environmental valuation as required by RA 7942 and the “precautionary rule” on the environment Test case: Palawan Mt. Mantalingahan study commissioned by DENR/PCSD: Value of water and carbon stock = P70-94b. Value of mining = P15b. Circumvented by moving bounderies.
WITH RESPECT TO MINING IN ALLOWEDAREAS….…CONT’DSerious p problems of g y governance, as admitted byDENR and the mining community, must first beaddressed No standard yet for resource and environmental valuation (draft MTPDP 2011-2016, Chapter 10) 2011 2016, and climate change adaptation - Institutional i I i i l incapacity to i l i implement “responsible” mining, esp technical experts
ECONOMIC ISSUES ( ) Mining industry: Mineral resources are there to (1) g yserve the needs of humanity and the country.Minerals are raw materials for many of our modernconveniences. i Our O answer: Mi Minerals should not be extracted l h ld b d where the full cost of extraction is more than the benefits. Otherwise benefits Otherwise, the poor who mainly suffer the environmental and social costs would be subsidizing the rich. g
ECONOMIC ISSUES CONT’D ISSUES……CONT D(2) Mining creates wealth and developmentOur answer: Mining does not create capital.Minerals are the wealth/capital built up overmillions of years. Mining converts it intoanother form – money. The money should beused to create real capital to replace it.Moreover, aren’t there better and less costlyways to raise development financing?
MINING CREATES WEALTH AND DEVELOPMENT…CONT’DNo idN evidence that money f th t from mining i i i g invested i t d inreal capital – average mining contribution = 1.5%of GDP. In many countries, most profits/rent went f GDP I ti t fit / t tto mining companies and corrupt officials.Does this happen in the Philippines?
ECONOMIC ARGUMENTS ARGUMENTS…… CONT D CONT’D(3) Mining Industry – Brings in big investments,huge tax revenues.Our answer: Big figures are misleading, andresults h lt have been relatively poor: b l ti l - Phil revenue effort = 15.4%; - Mining industry = 7.8%-9.2% (w/out WHT)
ECONOMIC ISSUES CONT’D ISSUES……CONT D On collection of excise taxes. taxes MGB data show exports were 18%-49% g t d t h t 18% 49% greater than Gross Value Added of Mining (2004-2008) MGB data (1997-2009) show under-collection in mining of excise taxes was 54% 83% of what 54%-83% total annual excise taxes should be. Is there under-declaration to avoid paying taxes? under declaration
ECONOMIC ISSUES ISSUES… y g The fiscal incentives unnecessary – Extracting minerals is driven by international demand Economic literature - “rent” can be taxed because it is excess over reasonable rate of return. The country and local communities do not really y y get a fair share of the extracted irreplaceable capital.
ECONOMIC ISSUES ISSUES…(4) Mining industry. “Big” contribution to social industry Bigupliftment of rural areas Our answer: Not true. Actually small amounts, even under RA 7942 = approx. 2%-3% of estimated profits “Sustainable mining” is an oxymoron. Sustainable development like in the U S Canada, Australia etc U.S., Canada Australia, etc. based on: integration strategy triggered by knowledge development. Are these present in the Philippines?
ECONOMIC ISSUES…….. (5) Mining Industry. Mining creates many jobs, brings employment to rural areas Our answer: Not true. Extraction activity is co s de ed o job c eat g dust y a o e considered low job-creating industry all over the world. Unless there are backward and forward linkages, which is not the case in the Philippines. Employment contribution to economy – less than 1%.
ECONOMIC ISSUES ISSUES…..( ) Mining Industry. RA 7942 is a “model law” on(6) g y“responsible” mining. It effectively addresses theconcerns about degradation of environment andrehabilitation of mined areas. h bilit ti f i d Our O answer. RA 7942 may be a good law on paper. b dl But institutional capability to implement/enforce “responsible” mining is NOT in place in the responsible Philippines. There is not even a standard to measure environmental and social costs
MINING IS LONG ON RHETORIC AND SHORT ON RESULTS.BUT WE BOUGHT THE RHETORIC AND MADE IT PUBLICPOLICY…… “Long term, high profit mining translates into (1) higher revenues for government, (2) more decent jobs for the population, (3) more raw materials to feed the engines of downstream and allied industries and industries, (4) improved chances of human resource and countryside development by creating self- reliant communities away from urban centers. (Pres. Fidel Ramos )
WE BOUGHT THE RHETORIC AND MADE ITPUBLIC POLICY…… (1) responsible exploration, development and utilization, d ili i (2) to enhance economic growth, (3) in a manner that adheres to the principles of sustainable development (4) with due regard for justice and equity, sensitivity to the culture of the Filipino people and respect for Philippine sovereignty.” (Pres sovereignty ” (Pres. Gloria Arroyo)
EVEN THE SUPREME COURT INCORPORATEDTHE RHETORIC IN ITS DECISION…. “……Control..(to make sure) that these enterprises contribute to the economic development and general welfare of the country, country conserve the environment and uplift environment, the well-being of the local affected communities. communities ” (CJ Panganiban in La Bugal Bugal- B’Laan case.2008)
QUESTION….QUESTION Have these expectations been realized? H th t ti b li d? Will we repeat the “sins of the past”
THE AQUINO ADMINISTRATION ON THE ISSUE OFMINING VS. BIODIVERSITY President Aquino s remarks on Sept. 23, 2010, Aquino’s in New York to Council of Foreign Relations “The Philippines….has one of the world’s largest d l g t deposits of gold, nickel, copper and it f g ld i k l d chromite. Through responsible mining, we intend to g i t d t generate more revenues from the t f th extraction of these revenues.”
THE AQUINO ADMINISTRATION ON THE ISSUE OFMINING VS. BIODIVERSITY.. CONT’D p , q In the same speech, President Aquino said: “The Philippines is of the view that The development and poverty alleviation are benefits derived from biodiversity. For this y reason, the Philippines is committed to biodiversity conservation and to the attainment of the objectives of the Convention on Biological Diversity.”
IF THE AQUINO ADMINISTRATION IS DISPOSEDTO BAN MINING IN PALAWAN,, Can this be done? It seems the President can. The Th SC decision i th L B g l B’L d i i in the La Bugal-B’Laan case on the principle of “full control and supervision” under Art. XII, Sec. 2 of the Constitution said d A t XII S f th C tit ti id that, “the State retains the power to direct overall strategy; and t set aside, reverse or ll t t g d to t id modify plans and actions of the contractor.”
CONT DCONT’D In La Bugal B Laag, the SC also said: Bugal-B’Laag, “The idea of full control is similar to thatwhich is exercised by the Board of Directors of aprivate corporation..” “Who “Wh or what organ of g h t g f government actually t t llexercises this power of control on the behalf ofthe St t ? The Cth State? Th Constitution i clearly clear: th tit ti is l l l thePresident.”
CONT DCONT’D The issue of “i Th i f “impairment of contract” would i t f t t” ld not even arise because, if we follow the logic of La Bugal-B’Laan, thi amounts t a decision of L B g l B’L this t to d i i f the Rio Tuba Board.
TO SUMMARIZE OUR POSITION ON THEECONOMIC ISSUES: If the true economic value of mining is, at the least, disputable least disputable, applying the “precautionary precautionary principle”, why not disallow it in a valuable and fragile island ecosystem like Palawan? It can be argued that the SC decision in La Bugal-B’Laan empowers the President to do thatthat.
SUMMARY……. CONT’DSUMMARY CONT D Secondly, the government should revisit the cost-benefit evaluation of mining p j g projects and put the institutions in place to implement responsible mining before moving ahead with mining. Unlike other businesses, wrong decisions on mining are irreversible because mineral resources once extracted are non- i l t t d renewable.