Commencing in April, PMEA's evolution from IMEC into an SEC-registered, non-profit organization was completed in the third quarter of 1998. The Articles of Association identified six objectives which are intended to guide the strategy and activities of the new body, these are:

• To promote the responsible development of the mineral exploration industry in the Philippines.

• To coordinate with the government and its relevant agencies in promoting its policy of sustainable development for the mineral industry.

• To provide a forum where the exploration industry can examine issues, formulate policy and agree on a course of action which is deemed to be in the best interests of both its members and the industry as a whole.

• To provide appropriate response to community and environment issues raised by the press, public or responsible non-government organisations.

• To acquire and disseminate trustworthy data and information relating to the minerals industry.

• To work towards the establishment of a code of ethics and standard procedures in all facets of the exploration industry.

 

This report will highlight PMEA's efforts to achieve those objectives over the last 12 months and comment on the success, or otherwise, of those endeavors.

1. Promotion of the Mineral Exploration

This is clearly the primary objective of the Association. In light of the impending change in government, a concerted effort was made to ensure that the new administration was fully briefed as to the realities of our sector and the challenges it was facing. In this regard the following was accomplished:

Meeting with new DENR Secretary

Attempts at securing an early audience with Secretary Cerilles were unsuccessful and we were asked to defer our meeting until after the confirmation of his appointment. As a result, the Board prepared a 'position paper' entitled "Mineral Exploration in the Philippines - A view from the Explorers". This 5-page paper (summary attached) summarized PMEA's perception of the prevailing situation and provided suggestions on how the key issues could be addressed. It was delivered to the office of the Secretary on August 28th and copied to the Director of the MGB on the same day.

Meeting with NCIP

Following the formation of the NCIP, four of the PMEA Trustees met with the Chairman, David Daoas, in an effort to assess NCIP's view on exploration. They also requested the opportunity to provide commentary on the Implementing Rules that the NCIP were formulating. The meeting was cordial and encouraging. The Board followed up with correspondence and commentary on an early draft of the IRR.

However, it appears that our contribution was not taken seriously as the final IRR was poorly crafted and contained much ambiguity raising concerns that the assurances that we had received during our meeting would not be honored.

Establishment of monthly workshops with the MGB

This was a PMEA initiative, which was designed to facilitate a stronger working relationship with the MGB. The first meeting, held on August 28th was a resounding success and it appeared that it would promote a better understanding of the issues between the government and the private sector and could result in some significant improvements in permitting.

Sadly, due to other priorities within the MGB only one more workshop was held in 1998 and the initial expectations have had to be scaled down. However the Director of the MGB recently reaffirmed his support for the concept and the 1999 PMEA Board should focus on resurrecting the workshops as they could provide a valuable forum for discussion of the key issues of the day with government leaders.

2. Coordination with the Government on promoting sustainable development

It was anticipated that PMEA's position would largely be in a supportive position providing assistance and contribution to initiatives made by the Government in the promotion of their policy. In this regard PMEA participated in the following:

• Making a presentation on 'Sustainable Development' to the Regional Directors of the MGB at their annual conference held in Subic (July '98)

• Provided speakers and papers to the MGB 'Seminar on Responsible Mining' (Dec '98)

• Provided one of the judges in the determination of recipients of the Presidential Awards for Environmental Excellence (Sept - Nov '98)

3. Provision of a forum for discussion and debate on industry issues

The monthly members' meeting is designed to fulfill this role and the Trustees have made every effort to invite keynote guest speakers from both government and the private sector to each meeting. The selection of the speaker has been guided by the desire to have key people who have the potential to influence the direction of the industry. To-date some of the speakers have included the following:

• Atty. A. La Vina - former U/Sec of legal affairs in the DENR

• Director H. Ramos of the MGB

• Ass. Director E. Domingo of the MGB

• Mr. Art Disini, President of the Chamber of Mines

• Mr. Raul Hernandez, Chairman of the Phil-Australian Business Council

• Atty. Leo Dominguez, President of the Phil-Australian Business Council

• Mr. Terry Gardner, President of WMC Philippines

• Mr. Rob Gregory, Vice President Operations, Climax-Arimco

The following were identified as possible future guests and some preliminary approaches have already been made. It is hoped that the new Board will follow-up and that they will shortly accept invitations to speak at future meetings:

• Secretary Cerilles, DENR

• Commissioner Daoas, Chairman of the NCIP

• Senator G. Honasan, Chairman of the Senate Committee on Natural Resources

• Congresswoman Cruz-Ducut, Chairman of the Environment Committee

• Atty. Gasgonia, Presidential Assistant for Poverty Alleviation

4. Provide appropriate response to issues raised in the press and NGO's

In 1998 the PMEA had a policy of not initiating any unsolicited press releases on its own, however we have frequently been asked by the media to comment on developments within government or issues raised by third parties. Any response provided by the Board has been tempered by the need to maintain a sincere and credible relationship with the media and the sensitivities of many mining issues will ensure that media liaison will continue to be a crucial component of PMEA's role for the foreseeable future.

5. Acquire and disseminate trustworthy data on the industry

In 1995, IMEC conducted the first survey of the Philippine exploration industry, this has become an annual event and IMEC/PMEA distribute questionnaires to their members in the first or second quarter each year. The results have provided invaluable information on the health and direction of the sector and have been used in many forums to illustrate the evolution of the development of the industry. The 1998 survey is scheduled to be conducted by the incoming Board.

6. Work towards the establishment of an industry code of ethics and standards

This was viewed as a key step in demonstrating the corporate conscience of the industry and a special sub-committee was established to look into this. Their work inspired the Chamber of Mines to consider the concept and, following the restructuring of the Chamber late last year, both groups put their heads together and the Chamber announced the adoption of an "Environmental Code of Conduct" during the Philippine Mining Conference last February. This is a major step towards confirming industry's support for responsible mining it is hoped that it will lead to ongoing improvements and a broader commitment to a policy of 'Best Practice'.

In addition to the foregoing, the PMEA have been active in a number of other areas. The most significant being a commitment to an intensive 'Information and Education Campaign' aimed at enlightening the new administration on the potential benefits of a progressive mining industry. This campaign, which took place during the last 4 months of ''98, was supported by additional funding from several member companies.

Highlights include the following:

• Presentation of the implications of IPRA to the Business Caucus1 of the Philippines (July 1st and Aug 25th)

• Meeting with Director Hernandez of the BOI with a view to making a presentation to President Estrada through the IDC/EDC2 council.

• Submission of a position paper to the 'Business Forum on the Employment Crisis' - a conference organized by the Confederation of Employers and attended by President Estrada3.

• Breakfast briefing to the ANZ Chamber of Commerce on the prospects for the mining industry after the passage of IPRA.

• Breakfast briefing to the American Chamber of Commerce on the prospects for the mining industry after the passage of IPRA.

• Presentations to the 'Foundation for Economic Freedom'

• Presentations to "Think Tank Inc.'

• Major commitment to the organizing and running of the PABC conference 'Can responsible mining be an answer to the economic crisis?' - November 17&18.

• Distribution of a "Philippine Mining Information Pack" (see attached 'appendix' for details) to the following:

• Senator G. Honasan - Senate Chairman Committee on Natural resources

• Congresswoman Z. Cruz-Ducut - Chairwoman Environment Committee - House of Representatives

• Justice Munoz-Palma - Former member of the Philippine Constitutional Assembly

• Atty. Gasgonia - Presidential Assistant for Poverty Alleviation

• Dr. Richard Szal - Director of the International Labor Organization - Philippine office

• Governor Leviste - Governor of the Board of Investments.

• Dispatch of a special letter and Information Pack to Senator E. Angara as a result of meetings held with the mining sector during his visit to Australia in November.

• Preparation of 18,000 industry promotion posters (10,000 given free to the MGB, Chamber of Mines, Phil. Mine Environment and Safety Association and the Geological Society of the Philippines).

• Submission of a "Position Paper" to Gov. Leviste of the BOI (Feb 4th '99)

• Industry briefing to Mr. G. McMann of the World Bank (Feb 22nd '99)

Summary

As a result of the introduction of new personalities and policies of the new administration the last 12 months have been particularly hectic. This has been further exacerbated by mining's poor press coverage, the 'crisis' in SE Asia and the general, worldwide decline in investment in exploration.

Over the last year the PMEA has enjoyed successes in alerting the new government to the realities of the industry and has been able to demonstrate that much of the media sensationalism and emotion should be rationalized and put into a national perspective. However, the new national administration has been slow to demonstrate its support for mining through any concerted action and many of the problems facing the industry a year ago remain unresolved. The recent confirmation of the DENR Secretary is encouraging and could herald some changes and in light of this suggestions on PMEA's objectives for 1999 include the following:

1. Encourage the MGB/DENR to:

• Resurrect and 'institutionalize the workshops with the MGB

• Refine and pursue the concept of a 'Qualified Explorer'

• Expedite arbitration and administrative 'due process' canceling any applications that do not conform to the requirements of the IRR

• Review the FTAA in light of globalization and competing regimes worldwide

2. Strengthening the ties with the Chamber of Mines, by:

• Pooling of resources and support for a coordinated national IEC campaign

• Holding of regular, joint member's meetings

The PMEA deserves support and encouragement by all those who believe in the exploration potential of the country and have a genuine commitment to doing business in the Philippines. Although it has been slow, there has been progress and with the recent confirmation of the Secretary, now is not the time to give up or sit on the fence.

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The Key Issues: Priorities and possible remedial strategies

1. First Priority - Permitting

a. Convene an inter-agency workshop to review the permitting process with the exploration sector.

b. Resolve the inter-agency issues pertaining to administration of area clearance procedures.

c. Strengthen and implement compliance requirements and penalize applicants who do not conform.

d. Amend the IRR to conform to the appropriate changes resulting from the above.

2. Second Priority - FTAA's

a. Resolve the issue of jurisdiction over mineral resources in IPRA areas with the NCIP.

b. Convene an inter-agency working committee to review the administrative viability of the proposed fiscal provisions of the FTAA.

c. Review and amend the pro-forma to conform to the new requirements of IPRA.

d. Review and finalise the FTAA pro-forma document in line with the above.

3. Ongoing, parallel issues - Legal

a. Resolve the definition of "Qualified Person".

b. Resolution of the Supreme Court petition.

c. Resolve differences between IPRA and Mining Act and revise IRR accordingly.

Appendix B:       The Mining Industry 'Information Pack'

 

The "Info Package" contained the following:

1. A brief, 2 page description of the PMEA, its origins and objectives.

2. A Computer disc containing the following documents (in MS Word 6.0/95):

• RA 7942 (the Mining Act of 1995) and its Implementing Rules and Regulations.
• RA 8371 (the Indigenous Peoples Rights Act), and its Implementing Rules and Regulations.
• A copy of a paper entitled "Mining in the next Millenium" - which contains many tables of relevant facts, economic data and industry related statistics.
• A number of other relevant papers from the Mines and Geosciences Bureau.

3. A booklet entitled "Meeting the Challenges: Mining, the Community and the Environment" - a compilation of relevant papers prepared by the Chamber of Mines - special attention should be given to the following papers:

• "A response to the issues raised against mining" by Dir. H. Ramos, MGB
• "The Philippine Mining Act of 1995: Moving the industry into global competitiveness" by Ass. Dir. E. G. Domingo, MGB
• "Environmental issues facing the mining industry" by Dir. H. Ramos. MGB

4. A copy of a booklet produced by the NSW Minerals Council - "Best Practice Community Consultation" (this demonstrates the recognition that the industry is giving in respect to it's responsibilities to the communities).

5. "What Mining means to Australians" a booklet produced by the Minerals Council of Australia containing some very useful general information on the national social and economic implications of a robust mining industry as enjoyed by Australia.

6. "The Bedrock of the Economy" quantifies what mining means to the economy of Australia.

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1  Body comprising of all the foreign Chambers of Commerce, PCCI, the Employers Confederation of the Philippines, Phil Exporters Confederation., Management Association of the Phils., Makati Business Chamber.

2  Industry Development Council and the Export Development Council - a body created and managed by the BOI

3 It is believed that this conference influenced the Dept. of Trade and Industry to initiate the formation of a 'special task force on mining' which led to clarity on the implications of IPRA on mining.

4 NGO body committed to the advocacy of market-based public policy.

5 NGO body concerned with policy advocacy.

6 Also presented a keynote paper on the potential impact of mining in the new millennium.

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