Where's the Development?

In April 2010, report from the island said that heavy equipment were brought to Lagsingan, a sitio of Poblacion, Rapu-Rapu. Initial information includes the construction of a road from Poblacion to Morocborocan. In response to a letter, the Department of Agriculture disclosed that the project is a farm-to-market earth road 1,800 meters long and budgeted with P5 million. Our fear is that a mere earth road will not last when the rains fall later this year. Where is justice for Rapu-Rapu? After giving an estimated P10 billion to the miners, all that the island gets in return is an earth road!

A reporter of a big TV network went to the island and told this author that there is no development in Rapu-Rapu.

So, where’s the development promised by advocates of mining? I am reminded of the article written by Peter Wallace. On October 27, 2007, Mr. Wallace published his opinions through an article titled “Where’s the pot of gold?”

Mr. Wallace wrote:

Mining has been touted as one of the sectors government will promote as a major contributor to the economy. . . Early this year, mining exports were to be 3 percent of the total exports or about $1-$2 billion. Just recently the Mines and Geosciences Bureau quoted $10 billion as a likely investment figure.

By now investment should be far higher, the big mining companies should be aggressively exploring, joint venturing, buying mines. But, except for a handful, they’re not.
A smart government would ask why, and act to change it. The secretary of the Department of Environment and Natural Resources should be talking to the industry and asking why.

The first to feel sorry for such a dour situation should be the government. It seems an Australian is sorrier and does all the sour-graping. Why? Because foreigners like him have more to gain from the newly bared mining resources of the Philippines than Filipinos ourselves. Like a virgin being undressed before alien eyes, the mountains of our country make the mouth of Mr. Wallace water.

Since Mr. Wallace really thinks so low of us Filipinos I am inclined to return the volley. Australia began to be colonized by England as a place of exile for rapists, murderers, thieves and other species of low life. If he thinks $10 billion is not being availed of by us then he should be happy because such huge amount is still in his countrymen’s hands. One man’s expense is another’s income. The Filipino’s non-income is the foreigner’s savings. We do not feel sorry for that but Mr. Wallace does! Why? Because that $10 billion is a “bait” with which the likes of him would ensnare our people and squeeze out the bounty of our land. No fool would put in one dollar and get 90 cents in return. Mr. Wallace proposes to pour in $ 10 billion because he wants foreigners to receive 20, 30 billion dollars or more. In Rapu-Rapu, for example, Lafayette is reported to invest $40 million. A browsing of the company’s website and a research on metal prices plus some arithmetic would reveal that Lafayette would earn $1.549 billion. That’s earning $38 for every $1 invested! What do the people of Rapu-Rapu get in return? In Mr. Wallace’s word NADA! They got five major fishkills, 68% decline in fish catch, decline in copra production, landslides, black bug infestation brought in by Lafayette ships, total loss of drinking water supply in Barangay Pagcolbon, militarization, poverty, and migration.

Filipinos are not taking the bait and so Mr. Wallace calls our government unsmart and by extension, our people too.

If the current rush into mining concessions is not enough for Mr. Wallace that is his problem. We, Filipinos, do not need an alien like him to tell us what to do. For us, the frenzy over mining explorations is destroying our forests, mountains, rivers and seas. In return, so much destruction of livelihoods has happened. In Rapu-Rapu, for example, five fishkills have been documented. An average of 68% decline in fish catch was reported by Ibon Foundation in a study conducted in February 2007.

We have been dictated to by foreigners since 1565 when Miguel Lopez de Legazpi arrived. We do not need another dictation disguised as unsolicited advice from an alien. That constitutes foreign interference. His advocated foreign investment in an industry originally exclusive to Filipinos is economic interference.

Mr. Wallace wrote:

There, of course, is one reason I can immediately cite: Continuity. You don’t change managers every few months if you wish to instill a sense of stability in a system. . . It’s crazy. It introduces a level of uncertainty that if you’re investing hundreds of millions of dollars, you will surely pause to think. Every manager (in this case Secretary) has his own philosophies, own set of priorities, own agenda. And a change can be quite substantial, particularly in a country where the leader herself has changed policy emphases fairly frequently.

If Mr. Wallace meets a problem he will not solve it. He will find someone or something to blame. In this instant case, he blames the government. If there is any wrong which our government has done it is not doing nothing. Rather, it is doing so much for foreign companies. One regional director even sounds like the spokesperson of Lafayette. Our government provides tax deductions and holidays to the countrymen of Mr. Wallace. I pay 23% of my annual income as tax. I work for 12 months, I give back two months income as tax. With 13th month pay, I have the equivalent of 11 months of earnings to use for my needs. Since there is a 12% EVAT approximately another month’s income is taken away as tax. That leaves me with only 10 months out of the equivalent of 13 months of work.

What tax is paid by mining companies? Under the PEZA privileges, they pay only 7% plus the measly real estate taxes. However, they are given by the Special Economic Zone Act, a tax-free period of six to eight years. Originally, Lafayette said its mine life was six years. Later the company adjusted it to eight years. Those estimates are not results of a technical study. They are results of a taxation study. Other corporations are taxed at the rate of 32% of their income.

Mr. Wallace wrote:

On top of that, the government has done a poor job at protecting the industry from attack. The incident at the Lafayette mine in Rapu Rapu was allowed to get completely out of hand. Oppositors, including Bishop Bastes, had a field day— and the government stood by. It even, quite unbelievably, encouraged it by appointing this bishop to head an investigation. He, of course, recommended closing the mine.

Well, he almost succeeded, and the government’s dilly-dallying over giving approval to re-open the mine almost broke the company. This was a minor incident. It should have been resolved within 3-6 months. Lafayette had made the corrections by then, but it was 12 costly months later before approval to re-open was given.

As to countering the rabid vilification by oppositors and giving a true picture of what happened, the government did nothing. Just stood by.

The Arroyo government has been overly protective of foreign interests while laying bare to alien rape the patrimony of its citizens. In the Rapu-Rapu case, Lafayette failed the “tutorial” run. The leaks and other failures are documented in the Technical Working Group Report. Instead of honoring his word, “You fail it, I close it!”, Mr. Angelo Reyes permitted the company to resume operations.

One nasty practice of opinion-makers is the use of exaggeration as in claiming that Bishop Bastes “had a field day – and the government stood by.” If I read the TWG Report on the “tutorial” run correctly and saw the ceremonies in Malacañang with clear eyes, the government was severely biased against the RRFFC and favored the minority report of Mr. Gregorio Tabuena. It was Mr. Tabuena who recommended a “test” run which was not in the recommendations of the commission. Of all the commission’s recommendations, none was heeded. If that was not protecting the foreign investor, then what is?

The government stood idly by. That’s true. It did nothing to protect Filipino interest. Yes, the recommendation was to close the mine. Just a minor correction: that recommendation did not come from Bishop Bastes. It came from the majority. The Tabuena recommendation for a test run was heeded by the government. In spite of so many concessions to Lafayette, Mr. Wallace still has the gall to whine about a government that “stood idly by”. He even has the chronology confused. The government did not stand idly by then appointed Bishop Bastes. Instead, the government appointed Bishop Bastes, ignored the recommendations of the Commission, heeded that of Mr. Tabuena, then showered Lafayette with so many favors. After all that, Mr. Wallace still feels so much inadequacy.

The “rabid vilification” was committed not by Lafayette oppositors but by Lafayette apologists and the company’s own Community Relations Department. Consider the following:

Atty. Bayani Agabin threatened to sue those spreading the “hoax that was the October 2007 fishkill”. Glaring evidences in the form of reports and photographs abounded but to Atty. Agabin the fifth fishkill was a “hoax”.

At least two members of the Albay Sangguniang Panlalawigan staunchly defended Lafayette against the accusations.

The true picture of what happened was distorted by Lafayette itself when its managers denied in public their culpability for the October 2005 fishkills but admitted it in their private communications to the DENR.

The truth about Lafayette operations was suppressed when the Philippine Daily Inquirer removed from its February 17, 2007 issue the body of the story titled “Environmentalists from 27 nations sign petition for investors in Rapu-Rapu mine to pull out. We searched every page of the issue but the story was nowhere.

If we remember correctly, it was the RRFFC specially Bishop Bastes who was severely vilified.

Mr. Wallace wrote:

When I come across media’s virulent attacks on mining, on top of the tirades of some members of the Church and well-funded NGOs, I wonder why mining companies even bother at all. Why not just leave the Philippines to be a backwater with its people in poverty? I’m not aware of any action any of these groups are doing that would give a job and a decent life to Filipinos. I’m not even aware of any positive action many of these groups are taking to improve the environment.

We also wonder why despite the strong and loud protests against mining companies they still remain in the country. Makapal ang mukha is our word for it. We also wonder why a guest of the Philippines is allowed to stay here longer than a day after insulting us with: Why not just leave the Philippines to be a backwater with its people in poverty? We had prosperity in the 1800s from the abaca industry. Our economy was second only to Japan’s in the 1960’s. It never boomed because of mining. Masbate and Camarines Norte have been mined since the Spanish times but they remain among the poorest ten provinces to this day. Take these statistics:

Aroroy, Masbate has been a mining town since 1837 (http://www.geocities.com/ppsec/pp/masbate.htm) yet it is only a 2nd Class municipality (http://en.wikipedia.org/wiki/Aroroy,_Masbate). Masbate is the poorest province of Bicol with a poverty incidence level of 62.8% according to the NSCB survey in 2000 (http://txtmania.com/trivia/national.php).

Paracale, Camarines Norte has been a mining town since 1939 (http://www.wallstreetreporter.com/linked/PearlAsianMiningIndustries.html) and yet it is only a 3rd Class municipality (http://en.wikipedia.org/wiki/Paracale,_Camarines_Norte). Camarines Norte is the second poorest province of Bicol, with a poverty incidence level of 52.7% according to the NSCB survey in 2000 (http://txtmania.com/trivia/national.php).

Rapu-Rapu, Albay has been mined since the 1930’s but it is only a 4th Class municipality (http://en.wikipedia.org/wiki/Rapu-Rapu,_Albay ), the poorest in the province.

Both Masbate and Camarines Norte are listed as among the country’s ten (10) poorest provinces per NSCB survey in 2000 (http://txtmania.com/trivia/national.php).

On the other hand, the country’s richest provinces and congressional districts derive their wealth not from mining but other industries:

In its 2000 survey, the National Statistical Coordination Board (NSCB) identified the ten provinces with the lowest poverty incidence levels. Each of the four districts in Metro Manila, composed of several cities and/or municipalities, was treated as a province in the survey.

1. 2nd district of Metro Manila1 4.1 percent (a)
2. 4th district of Metro Manila2 4.9 percent (b)
3. Bulacan, 5.4 percent
4. 1st district of Metro Manila (Manila), 5.8 percent (c)
5. Batanes, 7.5 percent
6. Rizal, 8 percent
7. Laguna, 8.6 percent
8. 3rd district of Metro Manila3, 9 percent
9. Bataan, 9.9 percent
10. Cavite, 10.2 percent.

(a) Mandaluyong, Marikina, Pasig, Quezon City and San Juan
(b) Las Pinas, Makati, Muntinlupa, Paranaque, Pasay, Pateros and Taguig
(c) Caloocan, Valenzuela, Malabon and Navotas

(Source: http://www.txtmania.com/trivia/national.php)

If those are not enough, consider these:


-----------------------Share in non-fuel minerals --------Population
-----------------------in Value of total Exports -------below Poverty line
Country -----------------(percent)-----------------------(percent)

Guinea-----------------------17----------------------------- 40
Niger-------------------------67----------------------------- 63
Zambia-----------------------66----------------------------- 86
Jamaica----------------------53----------------------------- 34
Chile--------------------------43----------------------------- 21
Peru---------------------------40----------------------------- 49
Congo------------------ ------40----------------------------- 49
Mauritania-------------------40----------------------------- n.a.
Papua New Guinea----------35------------------------------ 57
Togo--------------------------30------------------------------ 32

(Source: UNCTAD Handbook of World Mineral Trade Statistics; World Bank Development Indicators; UN Development Programme: Human Development Report 2001, quoted in the lecture of Dr. Giovanni Tapang of the University of the Philippines College of Engineering on January 31, 2006 at the Daragang Magayon Hall of Aquinas University of Legazpi).

The data show that these countries’ exports are composed of high percentages of non-fuel minerals and yet the percentages of their populations below poverty line are also very high. In his testimony before the commission on April 6, Hon. Alvarez stated that the mining communities of the Cordilleras, Canada, and Australia “have become miserable patches of poverty after the gold or the mineral ore was extracted.” So, what poverty alleviation can arise from mining?

These statements are downright arrogant: “I’m not aware of any action any of these groups are doing that would give a job and a decent life to Filipinos. I’m not even aware of any positive action many of these groups are taking to improve the environment.”

It is the problem of Mr. Wallace if he is unaware of certain things. Everyone has the privilege to choose ignorance. But arrogance is entirely different. He is unaware of the effect of Lafayette mining on the fish catch of fishermen in Rapu-Rapu – a decline of 68% according to an Ibon Foundation study in February 2007. Of the 286 jobs in the mine, only 131 are for the residents of Rapu-Rapu. The company promised 1000 during start up and 416 during normal operation in a Powerpoint presentation in 2001. The anti-mining NGOs are the ones protecting the livelihood of people. All that mining companies can give to ordinary people are menial jobs while their executives sitting in airconditioned offices earn millions. Mr. Wallace only has to read the annual reports of Lafayette to verify this. Not only are mining companies depriving people of their livelihood. The companies are also destroying the resources that should have been protected for the use of future generations as sustainable development requires.

Mr. Wallace also wrote:

If I were a mining company I’d like the government to tell me what it has done, and will do to fully protect my investment and my people. I’m not going to invest in a place where both are at risk. I’d have called all the mining company representatives that are here for an extended dialogue (meaning, two-way talks) about these issues: What are the concerns? What will be done about them?

Specific actions and corresponding deadlines committed to. I’ve offered to arrange it, but thus far I’ve had no response from government.

Since I am a taxpayer (while mining companies are given so much tax breaks) I’d like the government to tell me what it has done, and will do to fully protect my tax and my people. I’m not going to continue supporting an administration that places both at risk. I call on it to scrap the Philippine Mining Act of 1995. After 15 years, where is the development? What have mining companies like Lafayette done to our national patrimony?

Why demand response from our government? Mr. Wallace is not a citizen. He is better deported back to Australia for insulting us and advocating interests inimical to the Filipino people.


Mr. Wallace's article was downloaded from
http://www.manilastandardtoday.com/?page=peterWallace_oct26_2007 October 27, 2007