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Economic Provisions of 1987 Philippine Constitution Need Change

By Lilybeth G. Ison

House Speaker Feliciano Belmonte Jr. said on Tuesday the Philippine mining industry can grow much further, and contribute more to government revenues, rural development, and economic growth if amendments will be made in the economic provisions of the decades-old 1987 Constitution.

“Today, the constitutionality of the Mining Act of 1995 is still brought into question notwithstanding the Supreme Court’s decision. This is because of the 1987 Constitution’s 60-40 equity limitation clause on foreign ownership of land and natural resources,” said Belmonte in his speech during the opening of this year’s Mining Philippines Conference and Exhibitions held at the Sofitel Hotel in Pasay City.

“This is why I am advocating that we reconsider the economic provisions of the Constitution that restrict growth and progress,” he stressed.

In fact, Belmonte said that during the opening of the 3rd regular session of the House of Representatives, he proposed that the Constitution “be amended and not by categorically reassigning equity proportions to Filipinos and foreigners, but by allowing Congress to enact the laws that would define foreign participation and nationality requirements in strategic sectors of our economy.”

He said this strategy serves two ends. “First, we do not relinquish our sovereignty on the preservation of our God-given resources. Second, by making the assignment and reassignment of equity proportions a legislative measure rather than a constitutional given, we necessarily make reviewing and revising such proportions an ongoing task.”

“Timely policy amendments are thus more easily undertaken, and we give our economy a responsive and robust policy environment within which to flourish,” he added.

The Speaker said what the country faces today is “global and unabated environmental degradation.”

“What we need today is a new paradigm shift – adopting a new way of thinking that is in line with notions of sustainability. We need to see ourselves not merely as users and beneficiaries of precious natural resources. We have conveniently played out that role for too long. It is high time that we see ourselves as stewards of our country’s mineral resources,” he said.

Belmonte admitted that there are existing mining laws that need to be reformed and as such he urged the mining industry to bring these to Congress.

“We will certainly be very responsive,” he said.

The Speaker also noted Section 8 of Executive Order (EO) 79, which provides that concerned government agencies, the mining industry and other stakeholders shall submit, within a period of six months, a national program and road map based on the Philippine Development Plan and a National Industrialization Plan.

Said plans, he said, will be crucial for the development of value-adding activities and downstream industries for strategic metallic ores.

Belmonte said the plan should involve more processing, more value addition, and more downstream activities that lead to community-based supplier industries and services.

“EO 79, I believe, is already a step in the right direction — a first step in a series of necessary reforms. We need to resolve revenue-sharing issues as soon as possible, and if necessary, review the consultation process undertaken with indigenous peoples to ensure their protection and safety,” he noted.

“Furthermore, we need to improve transparency and accountability. The Extractive Industries Transparency Initiative under EO 79 should help us determine not only how much mining firms should pay to the government but also, equally important, how government should use these revenues,” he added.

The Speaker said there must also be continuous, appropriate, and specific capacity building within relevant institutions.

“Government must have the capacity to implement natural resources valuation, and monitoring and evaluation of environmental, social and economic impacts at all levels. These reform actions must be set in a clear plan with a reasonable timetable and budget as well as adequate personnel support,” he said.

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