PHL may not make it to EITI as mining firms sit on disclocures, says lead group

Categories: Business Updates

Date Posted: 25 Jul 2014

Getting the Philippines on board a global coalition on extractive industries is proving to be quite a challenge especially when it comes to meeting international standards on reporting revenues, taxes and royalties.

The year-end deadline for the Philippines is fast approaching, but so far only 33 large-scale mining, oil, and gas exploration firms have filed a signed waiver in favor of the government including full disclosure of tax payments and credits, Finance Assistant Secretary Teresa Habitan told reporters in a briefing Wednesday.

This means only 65 percent of the 51 companies the Philippine EITI or Extractive Industries Transparency Initiative has approached so their tax and royalty declarations can be included in the upcoming industry report.

Oslo, Norway-based EITI is a coalition of governments, companies and civil society working together to improve openness and accountable management of revenues from natural resources.

The PHL-EITI- Multi-Stakeholder Group and decision-making body, headed by the Finance Secretary was created through Executive Order 147 to make sure large mining and oil companies that make up the extractive industries comply with global reporting standards.

In April, the PH-EITI-MSG said the Philippines is expected to submit to EITI a report on the extractive industries by December 2014. The report was supposed to include the revenue streams, licensing structure, statistics, discussions and social management expenditure.

If the PHL-EITI-MSG fails to get all the companies to comply with the disclosure requirements, the group would have to defend why it wasn’t able to do so, said PHL-EITI national coordinator Marie Gay Ordenes.

“That will have a bearing on how they will evaluate us,” she said.

In June 2013, the Philippines achieved candidacy status before the EITI – which works to raise the level of transparency on payments made in the oil, gas and mining industries.

Issues of transparency

There are still “pockets of resistance” in the industry due to issues of transparency and sustainability, Chamber of Mines of the Philippines Legal and Policy vice president Ronald Recidoro said at the same briefing.

“Mining is a very old industry, a very conservative industry whose image has been battered in the public. We’re seen as destroyers of the environment,” Recidoro noted.

“There’s also this issue of sustainability. Can we sustain this effort that 20 years down the road, there’s still EITI,” he added.

But signing on the waiver can clear the cloud of doubt cast by public perception on the mining and in terms of the industry’s contribution to the economy, said Bantay Kita national coordinator Cielo Magno.

“As far as we’re concerned, their contribution to the GDP and employment are really very low based on data,” she said.

“This is a challenge for mining companies to prove us wrong, and you can only do that if you disclose 100 percent of their records,” Magno said.

Mining accounts for only 1.04 percent of GDP, but it holds the potential to attracting foreign direct investments and increase exports, government data show.

Bantay Kita is a civil society representative in the PHL-EITI initiative, spearheading the move to make the Philippines a membership of the coalition.

“EITI does not only focus on the tax payments and fees, we’re also going to disclose social expenditure… It’s going to be nice to have a solid picture of, aside from taxes, what are the social contributions of these companies,” Magno said. – VS, GMA News

Written by: Danessa O. Rivera

Source:http://www.gmanetwork.com/news/story/371662/economy/agricultureandmining/phl-may-not-make-it-to-eiti-as-mining-firms-sit-on-disclocures-says-lead-group

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