Countries are referred to merely as economies, as sources and markets of mineral wealth when the United Nations Conference on Trade and Develop- ment (UNCTAD) – the primary organization that un- dertakes information gathering on the global mining industry – describes production, trade and investments.
Based on the 1995 UNCTAD data sourced by IBON (2002), the world produced $125 trillion worth of non- fuel minerals. The “developed market economies” had accounted for 46%, while the “developing economies” contributed 43%. The balance of about 10% came from the East European countries. Metallic minerals comprised 74% of the total value of mineral production. (After IBON, p.171)
About 100 non-fuel minerals are traded and contribute about 1% of world GNP. There are 20 metals and 18 non-metals of importance – with the strategic minerals stockpiled against politically-induced shortage on world markets. (After Simmons, I.G. Earth, Air and Water [1991] Reprint 1993, p.117)
B.1 Patterns of Ownership and Control in the
Global Mineral Industry
(After Ericsson, M. in McDivitt, J.F. International Min- eral Development Sourcebook [1993])
The critical situation experienced by the world’s fiercely competitive mineral and metal industries during the 1980s represented not just a cyclical trough but a structural crisis caused by important changes in the demand and supply pattern for many of the traditionally important metals and minerals. Consequently, it brought about a global restructuring process marked by giant mergers and hostile take- over bids among the powerful transnational mining corporations (TNCs).
In the early 1990s there were more than 3,000 companies engaged in mining and smelting throughout the world. But there had been very few players in the high-stakes game of world mining. In both 1975 and 1987, the ten largest mining companies of the Western world controlled 32% of the total value of Western non-fuel mineral production at the mining stage. For that same period, state mining enterprises controlled 18% of the value of total Western world non-fuel mine output.
With its controlling share at 10-12%, the largest and the most powerful single mining company of the Western world as of the early 1990s was the Anglo American Corporation (AAC) of South Africa. It had controlled the largest share of six non-fuel minerals: vanadium around 50% of Western world production; platinum and palladium around 45%; gold at 35%; and antimony and tungsten at 20%. It also had ranked among the world’s largest producers of three other strategic minerals: diamonds, cobalt and uranium.
The British and the world’s erstwhile largest mining conglomerate Rio Tinto Zinc (RTZ), then the nearest competitor of the AAC, was only a third the size of the latter. RTZ had grown after completion of its acquisition of BP Minerals to control about 4% of the value of total Western non-fuel mineral production.
In 1995, the top 20 transnational mining companies had accounted for 52% of the mineral investment flowing round the globe (approx. $151 billion out of the total $290 billion). Then leading the pack of the top 20 transnational mining companies was the Australian conglomerate Broken Hill Proprietary (BHP), otherwise known as BHP Billiton Ltd./Plc (with $24 billion), outranking the RTZ (No. 2 at $13.6 billion) and AAC (No.3 at $12.3 billion) respectively. (After IBON, p.170)
As the mining conglomerate that outflanked the RTZ, the BHP is now recognized as the world’s largest miner having substantial interests in the production, processing (viz. refining and smelting) and trading of iron ore, aluminum, copper, petroleum, and natural gas, among others. (BusinessWorld October 22- 23,2004 Issue)
The US-based Newmont Mining Corporation (NMC) is the largest gold producer in North America and holds substantial interests in the Australian conglomerate Broken Hill Proprietary (BHP), aside from its gold operations in Indonesia, Peru and Turkey, among others. Ranked 19th in 1995, Newmont had a capitalization of $3.8 billion, of which 49% belonged to the Englishman Sir James M. Goldsmith, reputed as the world’s mining genius. (IBON, pp.86-87)
Ranked by foreign assets or properties outside home countries, the three mining transnationals that were included in the 1997 list of the world’s top 100 transnational corporations (TNCs) were: Sumitomo Metal Mining Co. Ltd. of Japan (ranked 16th in capitalization at $4.3 billion) at 85% transnationality; BHP (Australia) at 80% transnationality; and RTZ/CRA (United Kingdom) at 47% transnationality. (IBON, pp. 170-171)
The mining heavyweights have globalized their op- erations, and in due time, the world’s mining industry will be dominated by only a few giant corporations and conglomerates. Exploration funds have shifted dramatically from North America and Australia to South America and South East Asia. Within the next decade, about 50% to 70% of these principally U.S.- sourced exploration funds will be focused on devel- oping countries due to the following factors:
To realize their objective, the mining transnationals forge, expand as well as fortify partnerships with local mining companies in the host countries, and at the same time they create new outfits and arrangements in accordance with existing mining regimes (viz. Financial or Technical Assistance Agreement [FTAA], Mineral Production Sharing Agreement [MPSA], and Exploration Permit Agreement [EPA], among others).
Upon depletion of the host country’s mineral reserves, despoliation of its environment and extraction of super- profits from its domestic economy within a relatively short period, the transnationals pack up, then move on to new mining areas and resume their modus operandi.
B.2 Patterns of Ownership and Control in the Local Big Mining Industry
Based on the DENR MAP 2004 data, there were only eight operating large metal mines left as of 2002 from the original total of 58 mines in 1981. A separate survey of IBON in 1996 had counted 14 operating large metal mines.
These included the country’s major producers of gold, copper and silver metals, namely: Benguet Corpora- tion, Lepanto Consolidated Mines, Manila Mining Corporation, Philex Mining Corporation and United Paragon Mining Corporation.
The principal local owners of these big metal produc- ers are as follows:
In addition, three surviving nickel producers (all be- longing to the Zamora Group) were counted, namely Rio Tuba Nickel Mining Corporation, Hinatuan Min- ing Corporation and Taganito Mining.
A cursory examination (from letters A to Z) of the 15 family names identified as principal local owners of the big metal mining companies indicated clearly that large-scale mining has remained an exclusive preserve of the old rich and nouveau riche in Philippine society.
Based on available data, the identified foreign interests big-time or otherwise linked with these mining companies were as follows:
Despite the pervading crisis gripping the world mineral industry, the owners of local blue chip Benguet Corporation, Lepanto Consolidated and Rio Tuba continue to enjoy a symbiotic relationship with the world mining heavyweights BHP Billiton, RTZ/CRA and Sumitomo, reminiscent of the comprador-patron relations of the colonial times.
But the mining transnationals are far advanced in terms of strategic thinking. They have maximized the use of stipulated mining rights (viz. FTAA, MPSA and EPA) to covet the country ’s choice mineral lands. As of 2002, there were 43 FTAA applications, including those of the BHP, RTZ/CRA and Newmont Mining Co. (NMC) according to IBON as sourced from the Mines and Geosciences Bureau.
B.3 Indigenous Peoples
Nearly 12 million Filipinos representing 15% of the present population belong to 110 distinct indigenous communities (or ethnolinguistic groups) and retain a close link with their traditions . The Philippine Constitution recognizes the ancestral land rights of indigenous people, and those rights finally became law, Republic Act No. 8371 otherwise known as the Indigenous Peoples Rights Act of 1997.(After National Commission on Indigenous Peoples [NCIP] Info Kit, 1997 and Christian Aid and PIPLinks report, 2004)
In the country, majority of these current exploration permits, applications for FTAA and MPSA, and mining operations cover the ancestral lands claimed by the indigenous peoples. Way back in 1997, there were 85 FTAA applications, 50 of which covered territories of the indigenous peoples, including Cordillera (12 applications); Caraballo (18 applications); Mangyan (4 applications); and Lumad (16 applications). (After IBON)
According to the LRC-KSK-FoE Phils. Mining Forum Briefing Kit (December 07, 2004), the total area covered by overlapping mining applications were:
On the other hand, the total area awarded with Certificates of Ancestral Domain Claims (CADCs) cov- ered 2,546,036 ha. Related applications such as the Certificates of Ancestral Domain Titles (CADT) and other non-documented Ancestral Domain (AD) were not included
The mining applications in the CADC areas totaled 1, 199,849 ha or 47% of the total CADC areas.
As disclosed recently by the DENR/MGB Regional Office at Baguio City, the following applications covering the Cordillera Administrative Region (CAR) are awaiting the green light following the Supreme Court’s December 1, 2004 reversal:
Because of the successful defense and management of this land (viz. ancestral domain) in the past, today it contains a high percentage of the country’s total remaining forest. Since 1995, mining claims cover more than 30% of the remaining forestland of the
Philippines. Mining this land would have a high environmental impact as well as deprive many of the poorest people in the country of their existing lands and livelihoods. (After Christian Aid and PIPLinks report, 2004)
The Christian Aid and PIPLinks document stated: “Mining often leads to a direct assault upon the culture of indigenous people. Although on paper Philippine law protects the land rights of indigenous peoples, in reality their land is still under threat, as many mineral deposits are in indigenous territory and the pressure to allow mining is great.”
Its strong position dovetailed with what the British NGO Survival International had described: the 1995 Mining Code [as] “the major current threat to the future of tribal people in the Philippines”. The unresolved overlap between the lands targeted for mineral exploration and the ancestral lands claimed by the indigenous communities – caused by the national government itself – has sown the seeds of what may become a tragic conflict in the immediate future.