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From B2 Other major investment banks such as UBS and Goldman Sachs say that gold could reach $2,000/oz in the next 12 months. Phl mining industry’s growth potential

The Philippines is the fifth most mineral-rich country in the world for gold, nickel, copper, and chromite. Yet, the country’s mining sector remains largely untapped. In 2018, the Philippines only produced 36.8 tons of gold, ranked 24th in the world. According to the Philippine Statistics Authority, estimated gold reserves in the Philippines as of 2017 was over 200 million tons. Gold is often found with copper in the Philippines, and copper reserves (fourth largest in the world) is estimated to be over five billion metric tons. Nickel ore and its products (mixed nickel-cobalt sulfide and scandium oxalate) accounted for 49 percent of the country’s total metallic mineral output in 2019. The Philippines is the 2nd largest nickel producer in the world, behind Indonesia. Time to expand sources of dollar revenues

With many of our OFWs returning home, BSP forecasts remittances to drop five percent this year. Tourism growth has also stalled because of travel restrictions and people’s increased fear of traveling. Likewise, there are concerns of a possible decline in BPO and POGO revenues due to an economic slowdown caused by the pandemic. With gold prices projected to rise over the next few years and metal commodities on an upward trajectory, it may be time for the country to prioritize other sources of dollar revenues, such as mining. It will also create much-needed jobs, which will mitigate the unemployment created by the pandemic. Just as investors diversify their assets to reduce portfolio risk, it is also prudent for the government to expand its dollar revenue sources to cushion the impact of the pandemic on the country.

Philequity Management is the fund manager of the leading mutual funds in the Philippines. Visit www.philequity.net to learn more about Philequity’s managed funds or to view previous articles. For inquiries or to send feedback, please call (02) 82508700 or email ask@philequity.net.