Resource Investor: Philippines Anti-Mining Trash Talking Reverberates

Philippines Anti-Mining Trash Talking Reverberates
By Derek Moscato
03 Mar 2005 at 02:10 AM EST

VANCOUVER (ResourceInvestor.com) -- The February saber rattling in the Philippines, spearheaded by political radicals and environmental activists in that country and in some cases aimed to scare off foreign mining companies, continues to cause aftershocks overseas. The trash-talk is disconcerting for industry supporters in the West, as well as the rest of Asia, not merely because it threatens to roll back a good deal of progress to date, but more so because of the violent overtones.

"The worst foreign mining companies who plunder and ravage the environment and our mineral resources, as well as their military and police protectors, will be punished," said Gregorio Rosal, spokesperson for the country’s Communist party, who went on to say that his party’s military wing "can carry out a wide range of measures to disable the operations of the most destructive mining companies."

Fear and Loathing in British Columbia

The development was worthy of recent heavy coverage in Vancouver ethnic media circles. "Filipino rebels warn they will attack Canadian mining firms" were the words splashed across the front page of the Asian Pacific Post, which caters to the city’s substantial East Asian and South Asian communities.

The story went on to say that some of the supporters of the Communist Party of the Philippines and its anti-mining stance were overseas workers living in Vancouver.

It’s likely that more than one Howe Street promoter on the quest for a Starbucks fix did a doubletake when confronted with the headline and ensuing published threats.

The newspaper went on to explain that "as the rhetoric and threats of attacks intensify, students and priests from the Philippines’ powerful Catholic community have joined forces to launch a campaign to gather one million signatures nationwide to oppose the operation of transnational mining companies in the country."

Rhetoric Versus Reality?

All of this flies in the face of the good news coming out of the country’s mining industry, including the Supreme Court’s upholding of the legality of the 1995 Philippone Mining Act, which allows for 100% ownership of large mining projects.

Many junior mining concerns have been counting on increased economic and political stability to help bring investor interest back to the country.

Alberta-based miner Mindoro Resources [MIO.V], which is focused on gold-copper projects in the country, is a case in point. In a recent interview with Resource Investor Mindoro VP Penny Gould argued that changes like that have helped prop the local industry up. "We've been there since 1996, and we've seen many changes, particularly in the past few years," she said.

Shares of Mindoro have actually traded higher since the onset of verbal hostilities. Shares, which traded at roughly $C0.20 in January, have traded in the $0.30 to $0.40 range since mid-February. Gould did not return a request for comment on the most recent developments, however.

And shares of TVI Pacific [TVI.TO], another Alberta concern which has significant stakes in the Philippines by way of its projects at Canatuan and Rapu Rapu, have also been unfazed. The Toronto-listed stock, which traded as low as C$0.09 earlier this year, now trades at about $0.13.

The company is feeling heat from the London-based Peoples Indigenous Link and local church-backed environmentalists about its program at Canatuan.

Earlier in February, company president Clifford James had a private meeting with Philippines president Gloria Arroyo, in conjunction with the country’s Mining 2005 "Open for Business" Conference held in Manila.

According to TVI, she assured the company at the time "that she and her government would take all measures they could to support TVI and to resolve any problems encountered with local administrations and civil society."

TVI did not return messages from Resource Investor as of publication time.

The Media Wildcard

But in addition to the student-activist/Catholic/Communist coalition, the country’s outspoken media has sometimes positioned itself against the government’s pro-industry position.

"When nothing else seems to be working for the Philippine economy, the government is now promoting the country as the new El Dorado, with vast mineral wealth that some claim is enough to pay for all the country’s debts," writes Roderick T. Dela Cruz for the country’s Today newspaper. "Unfortunately, mining remains a troublesome area full of legal traps, which could ignite social upheavals that would only exacerbate the poverty problem."

The downer commentary is complemented by some unflattering international reports.

A recently released business survey entitled Moving Toward a Better Investment Climate and conducted jointly by Asian Development Bank and World Bank cites serious economic challenges for the country including weak macroeconomic fundamentals, corruption, infrastructure shortcomings, and excessive bureaucracy.

And a 2003 survey of 158 mining firms conducted by the Vancouver-based economic think tank The Fraser Institute found that the Philippines ranked only 40th among 47 countries in terms of overall investment attractiveness.

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Prudent Investor's Comment:

For the commies and mining detractors: they are immersed with absolute myopia and damaged culture. Eternal perdition awaits the country if these regressive thinkers prevail....B@#$%S!!!

Look around....Latin America, Australia, Canada, South Africa, Thailand, Indonesia and Malaysia (even India is now in the process of opening its mining industry to foreigners) or even some African states...are survived by extractives....are they inundated with environmental problems, plagued by social upheaveals? In Africa the political and social tumult arises not from extractives but administrative mismanagement and corruption. To say that these would be disadvantageous to the country is one HUGE pile of DUNG!!!