Incentives seen key to local ore processing
THE mining industry said it expects local ore processing to be viable given the right incentives, allowing the country to capture more value from its mineral resources.
Chamber of Mines of the Philippines ( COMP) Executive Vice- President Nelia T. Halcon said that miners’ capacity to undertake such ventures, as an alternative to exporting ore, will depend on financing, access to which will improve according to the government’s willingness to encourage investors.
“If the government packages the projects with incentives like (those offered by the Philippine Economic Zone Authority), investors will come,” Ms. Halcon told reporters on the sidelines of the opening of a mining conference, where the focus this year is “Realizing the Potentials of the Mining Industry in a New Regime.”
It will depend on political and financial will because it will always be a PPP (public-private partnership), when it comes to such big investments,” she added.
COMP’s Ms. Halcon proposed tax exemptions on equipment especially those designed to operate in a manner friendly to the environment, which include 2% to 5% of the equipment’s cost on top of value-added tax.
A shift to downstream processing of raw ore, however, may be “a longer-term plan” that may not even commence within the timeline of the current administration.
“You cannot do it overnight, you have to come up with economic feasibility studies that would give both the investors and the government the benefit,” she said.
Ms. Halcon, however, expects President Rodrigo R. Duterte’s government to see the potential of downstreaming to boost mining’s contribution to the economy.
“The President has been saying that we have to industrialize. I think that will be included in the six-year development plan,” Ms. Halcon added.
Senator Cynthia A. Villar, who was keynote speaker of the event’s opening, said that downstreaming should be considered part of the industry’s future, as Indonesia has done, but added she does not deem local miners to be prepared for the task.
“Not now because the industry is not that developed but it is something that we can look forward to in the future,” said Ms. Villar in an interview with reporters.
The lawmaker added that the policy should be reviewed thoroughly to prevent future setbacks, as the Indonesian government has been hinting it may to review its ban on raw-ore exports.
Ms. Villar added that the government will have to look into possible incentives that can be granted to miners who will venture into value-added processes.
Earlier, mining analysts viewed Mr. Duterte’s tough stance on miners with poor environmental management practices as a possible precursor to an Indonesia- style raw ore export ban.
Top nickel importer China turned to the Philippines after Indonesia’s 2014 ban to meet its demand.