The document summarizes reactions to presentations at the Mining Philippines 2018 conference on roadmaps for mining industry development, the potential "resource curse", and the impacts of federalism on natural resource extraction. Key points include: - The roadmap presented good initiatives but many government agencies create hurdles for mining; an alternative is for government to step back from the mining road. - Having natural resources is not inherently a curse; lack of rule of law is a bigger problem for development than adding more government bureaucracies through federalism. - Federalism could expand the government from two to three layers with many new elected officials and agencies, but there are no plans to streamline existing agencies first.

1. Reaction to presentations by
Arcansalin, Mendoza, Olivar and
Magno
Mining Philippines 2018
Sofitel Philippine Plaza, Manila
Day 2, September 18-20, 2018
Bienvenido Oplas Jr.
President, Minimal Government Thinkers
Columnist, BusinessWorld, “My Cup of Liberty”
https://miningasia.blog/
http://funwithgovernment.blogspot.com/
minimalgovernment@gmail.com

2. (1)Arcansalin/DTI presentation, “Roadmap for the Mining Industry
Development”
Good roadmap.
Establishment of “ecological industrial zone” in Leyte
 The usual question – who should determine where industries should locate,
government or businesses themselves?
But a better roadmap perhaps is for government to step out of the mining road.
But this is beyond the mandate and functions of DTI.
Many government agencies as humps and hurdles in the mining road…

3. National taxes
* Corporate income tax (CIT)
* Personal income tax of personnel & officers
* Value added tax (VAT)
* Withholding tax (WHTs) on dividends, WHT on
interest, WHT on royalties, on service fees
* Excise tax on minerals and imported goods
* Customs duties
* Capital Gains tax
* Documentary stamp tax
* Improperly accumulated earnings tax (IAET)
* Wharfage fees
* Royalty for Indigenous People (IPs)
* Royalty in mineral reservation
* Vehicle registration tax
* Special allowance under the Mining Act
* Various documents/permits required by MGB,…
Local taxes & fees
* Local business tax
* Real property tax (basic and SEF)
* Registration fees
* Occupation fees
* Community tax
* Mining operations tax
* Environmental fees
* Local wharfage fees
* Regulatory/Administrative fees
* Extraction fees on mineral lands
* Rental fees
* Mine waste and tailing fees
* Mayor’s permit fee
* Barangay permit
* Fire department permit, sanitation permit
* Provincial permit, other local taxes and fees
Mandatory Expenditures
* Annual Env’l Protection & Enhancement Prog. (EPEP)
* Social development and management prog. (SDMP)
* Community development program
* Environmental work program (EWP)
* Safety and health program
* Special allowance to claim owners & surface right
holders
Environmental funds
* Rehabilitation cash fund
* Mine monitoring trust fund
* Mine waste and tailings fees reserve fund
* Final mine rehab. & decommissioning fund
* Environmental trust fund
* Mine rehabilitation fund (MRF)
* Others
Bad roadmap for mining – too many taxes, fees, royalties, penalties, bureaucracies

4.  Amen to this. China is a communist, one-party, dictatorial state and hence,
unreliable partner over the long term. If it can bully its own citizens, how much
more weaker countries like PH.
“pursuing downstream development”  true but we should be careful not to fall into
the trap of “resource nationalism” like mandatory, state-dictated mineral
manufacturing like what Indonesia ordered some 2 decades ago.
 pointed out by Bill Sullivan‟s lecture last year in MP 2017.
(2) Mendoza and Cruz paper:
Generally quantitative paper, good.
“Resource curse”  why a curse? Having no resource is the curse.

5. (3) Gary Olivar, Federalism:
PH low development, poor infra, etc. as justifications to go federal.
 Lack of rule of law, not lack of more govt bureaucracies via additional state
govts, is the problem.
16 + CAR + Bangsamoro, 18 regions.
 on top of 80+ provinces, 80+ cities, and 1,400+ municipalities.
Wow, expanding the bureaucracies like amoeba.
“Impacts of Federalism on Natural Resource Extraction”
 Not discussed as federalism hard sell prevailed.

6. Duterte federalism plans to expand government from two to three layers with
three sets of elected officials:
(a) big national government with three branches (executive, legislative,
judiciary) plus Constitutional bodies,
(b) expanded municipal/city and provincial governments with their own
executive and legislative branches, and
(c) 18 state governments with their own three branches.
Federalism agenda palatable if there are explicit plans to
(a) abolish many national departments and agencies (like DA, DOT, DAR,
DENR…) and allow the state governments to create their own departments,
(b) abolish provincial governments and governors before creating state
governments and governors.
No such proposals exist. Federalism agenda is a big employment plan for more
government politicians and bureaucrats.

7.  I am happy to see that Cielo has transitioned to developing papers
supportive and not too critical, of the mining industry 
 expected outcome but it is important that these are quantified, good work.

8.  Yes, highlight the constant need for more, developed infrastructures.
 Yes, avoid subsidies aka „incentives‟, always leading to cronyism while
penalizing taxpayers.

9. Fraser noted: “The 10 least attractive
jurisdictions for investment based on
the PPI rankings are (starting with
the worst) Venezuela, Chubut,
Zimbabwe, Guatemala, Democratic
Republic of Congo (DRC), China,
Philippines, Indonesia, Bolivia, and
Ecuador.”
PH‟s attractiveness index:
2013, 99th/113
2014, 113th/122
2015, 89th/109
2016, 85th/104
2017, 85th/91

11. 1. Very small contribution by small-scale gold mining despite their huge env‟l damage.
2. Low mining investments when a huge, single biggest FDI, $5.9-billion Tampakan
project has been tempered.
3. Low exports share of metallic and nonmetallic exports when opportunities are high.
4. Significant tax collections by national and local governments.
5. Declining number of approved and registered MPSA, FTAA and EP.