Philippines plans new law to ensure responsible mining

* Duterte seeks “fair arrangement” to benefit people (Adds comments from mining executive, former minister)

Philippine President Rodrigo Duterte said on Friday the government will draft a new law for the country’s mining industry, which he said pays too little in tax and not enough in compensation for any environmental damage.

The fate of more than half of 41 mines in the Philippines, the world’s top nickel ore supplier, has been uncertain since February when then Environment Secretary Regina Lopez ordered their closure for causing environmental damage and violating laws.

Lopez led a 10-month industry crackdown until her dismissal in May by the Commission on Appointments following her mining orders, which included a ban on open-pit mining and a demand for a bigger government share in mining revenues.

She was replaced by Duterte’s friend, former military general Roy Cimatu.

“I’d like to tell you frankly, we will come up with new legislation … we have to rearrange everything,” Duterte said in a speech at a business conference in his home town, Davao City.

Duterte also said he would invite all industry stakeholders to the presidential palace for a dialogue together with former environment minister Lopez and other anti-mining advocates.

Duterte said he has always been supportive of Lopez’s pro-environment stance but could not stop mining because there is a law that allows the miners to continue to operate.

He also complained that the taxes miners pay are “too low” and lamented the lack of compensation to mining communities that suffer from environmental damage.

The Philippines’ No. 2 nickel ore producer, Global Ferronickel Holdings Inc welcomed Duterte’s invitation, saying a dialogue will help clarify problems with mining.

But Dante Bravo, president of Global Ferronickel, said his company has been paying a lot of taxes already, including a 30 percent regular corporate income tax, a 5 percent royalty on mineral reservation and a 2 percent excise tax, both based on gross sales.

“You sum it up, it is so heavy,” he told Reuters.

Duterte did not say when the meeting would take place but he said he planned to show industry stakeholders footage shown to him by anti-mining advocates, including Lopez, about the environmental destruction, as well as examples of good practices in mining.

“I will tell (them), look at the slides about good practices of mining, and I will ask everybody to focus on that,” he said. “Then let’s also look at the slides on mining gone awry.”

He also urged mining companies to “come up with an arrangement that is fair to everybody.”

Lopez, now an environmental advocate and TV travel show host, immediately thanked Duterte and said his “fearless stand” will help the country “see the light of day.”

“I can assure you a green economy based on love (for the environment) will be much more dynamic and all-embracing than an extractive one based on greed and selfishness,” Lopez said in a message to Duterte via a Facebook post. (Reporting by Enrico dela Cruz; Editing by Jane Merriman and Adrian Croft)

By Enrico Dela Cruz