Please read this critically and what do you t think about Indonesia?
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Description: In the first half of 2008 the Philippine government took a bullish position on the potential for new investment and development in the local mining industry. Private sector miners were on the whole much more cautious, however. In April presidential press secretary Ignacio Bunye gave the upbeat view. He noted significant interest and investment from foreign majors since a 2005 Supreme Court ruling that clarified ownership rights and opened up the industry. Total foreign investment in mining in 2004-2008 had been US$1.4bn. and Bunye expected another US$9bn to be invested by 2011, with the bulk of the money coming in between 2008 and 2010. By 2011 mineral shipments would be close to 6.5% of total exports, enough for the Philippines to be classified as a mining country based on World Bank standards.
Private sector miners were more guarded in their forecasts. Press reports noted that their concerns included rising costs, tough competition, gloomy financial markets and a number of specific local problems: land ownership disputes, communist and Muslim insurgencies and slow-moving bureaucracies.
'We have so many opportunities around the world available to us, if it's complicated, then we just couldn't be bothered to worry about it' Reuters news agency quoted Jesse James of US-based commodity fund Geologic Resource Partners saying.
The Philippines islands include 18 active volcanoes, and lie within the Pacific 'rim of fire', an orogenic belt associated with active ore-forming mineralisation. Three principal ore deposit types are associated with this volcanic arc environment - large-tonnage porphyry copper-gold deposits; disseminated and vein-type gold deposits, and volcanic sulphide deposits primarily constituting copper and gold.
The Philippines has had a long and established history of mineral production and once ranked among the world's top producers of chromite, copper, nickel and gold. According to various estimates, the Philippines hosts the world's fifth-largest gold and copper reserves. However, at the end of 2006, the nation's mining industry was valued at under US$2bn and accounted for less than 2% of GDP.
Considering the abundance of mineral potential in the Philippines, there are a number of factors that have constrained the domestic mining industry.
Production has been hampered for much of the last two decades by low foreign investment owing to political instability, accompanied by high costs of production, labour problems and natural disasters, including intense volcanic activity, cyclonic storms resulting in severe flooding and periods of extensive drought. Foreign investment has also been impeded by the requirement of 60% domestic equity control of the mining-processing facilities coupled with high excise taxes - mineral royalties - on production.
However, the Philippines mining scenario is not completely grim. An improving political situation, along with the fine-tuning of the Philippine Mining Act of 1995, has resulted in rising levels of mining development and exploration programmes throughout the nation. In 2004, the government unveiled the Mineral Action Plan (MAP), which identifies 24 large-scale mining projects. According to the Department of Environment and Natural Resources (DENR), these projects were expected to bring in US$4-6bn in investments and US$5-7bn in foreign exchange during 2004-2010. Mineral resources development has been identified by the government as an area of focus in the Medium-Term Philippine Development Plan, 2004-2010.
Industry Forecast The positive steps taken by the government towards mineral resource exploration and development are expected to bear fruit in the longer term. In the medium term, BMI forecasts a growth rate of 6.4% per annum on average over 2008-2012.
Tuesday, February 3, 2009
Monday, February 2, 2009
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