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Update No: 029 - (30/05/06)

The decision of President Gloria Macapagal-Arroyo to distance her government from the Malacañang-commissioned report which recommended a further review of foreign mining activities in the Philippines and, specifically, closure of the operations of Australian-controlled Lafayette Mining on Lapu Lapu Island in Albay province, is a welcome development and suggests that the government may yet be finding some resolve to act rationally and in the best interests of the country as a whole.
Many people had questioned why President Arroyo chose an anti-mining advocate in the form of Catholic Bishop Arturo Bastes to lead an "independent" commission into two (minor) cyanide spills from the Australian-invested Rapu Rapu mine in Albay Province, last October. The so-called fact finding body was heavily weighted towards environmental advocates and those who oppose foreign investment into the mining sector (or to put it more bluntly, those who think that foreign money is ok as long as foreigners do not control what is done with it.)
In fact, the good bishop may well have been set up. Certainly in delivering its final report, the committee went beyond its mandate by urging not only a revocation of the license of Lafayette Mining but also asking the government to again review the entire Philippine mining act and specifically the provisions on the ownership and management of mining firms and their operations. As one committee member put it, in less than diplomatic terms: the committee "wanted to send a strong message to investors that the Philippines was not a nation of prostitutes." That comment alone demonstrates the mindset of some of those called to provide an independent and informed opinion. It is a view not shared by the majority of Filipinos but the minority that pushes that line is extremely vocal.
The report was clearly biased, partial and directed against foreign investment into the Philippines. It acknowledged that the mining industry was very promising "if we do it properly by not sacrificing the environment and the people's health." 
The international investment community generally, as well as mining companies in particular, applauded the stand of the government saying that it sent a clear and welcome signal that the Philippines remained committed to attracting world-class mineral exploration and development companies. It has removed fears that the government was equivocating in the face of a concerted lobby by a minority of Catholic bishops who appeared opposed to foreign involvement in the economy while ignoring the damage that is being done by local vested interests in small-scale mining and in logging especially.
In a statement from the Chamber of Mines of the Philippines, chamber president Benjamin Philip Romualdez lauded the government for "continuously supporting the mining industry."
"The decision allowing foreign investments in the industry would ensure the flow of US$10 billion in investments into the economy with the planned expansion of existing projects and the operation of new ones," he said in a statement.
A number of foreign commentators have already drawn comparisons between the furore created by two very minor spills at the Lafayatte mine site with the total silence that followed when a Petron tanker chartered by the National Power Corporation spilled sufficient oil last December off Antique to threaten to destroy Boracay, one of the Philippines major international tourist destinations.

The newfound resolve may have come just in the nick of time. The temporary closure of the Rapu Rapu mine site threatened to become a permanent one -not by dint of any Filipino action but rather by loss of resolve by the foreign investors. The two spills had cost the company dearly. Not only had Lafayette paid PhP10.7 million in fines as a result of the spill it had also spent PhP400 million in remedial measures to prevent any possible reoccurrence in the future. Add to that the cost of loss production over what is now a six month period and it not hard to understand why there was the need to resolve the problem quickly and get the mine back into production or close down altogether. If the mine should close then the loss of investor confidence in the Philippines would be extreme.
Government resolve may be firming in other areas also. Recent press reports suggest that finally the administration may be about to crack down on corruption within the Bureau of Internal Revenue and at Customs. Nobody is yet holding their breath but it is a welcome sign that the government recognises that doing nothing is no longer an option.
Yet if finally the government has found the resolve to stand up to the bishops on an issue of vital economic importance, will it do the same with the military elite on an issue of equal importance politically? The much-decorated (and recently promoted) Major general Jovito Palparan has called for a new law outlawing the Communist Party of the Philippines on the grounds that its numbers were again on the increase. Most people would prefer to believe that the preferred answer to a growing insurgency problem (which to all intents and purposes remains extremely minor) would be to demonstrate that the government was indeed serious in its intent to do something concrete about he perennial problems facing the poor in the Philippines. Finally, perhaps it may be setting a proper course.

A footnote
The problems of Lafayette and its Rapu Rapu mine are not yet finally resolved. Permission to resume mining operations rests with the Department of the Environment and Natural Resources which has to review the findings and reinstate the operating permit of the company. For his part, Bishop Bastes has said he would write a "strongly worded" letter to President Gloria Macapagal-Arroyo if she ignores the panel's recommendation to stop mining on the island. 

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