Philippine mining industry stalled due to domestic opposition, weak demand

The Spanish seamen, priests and soldiers who arrived in the Philippines following in the wake of Ferdinand Magellan’s voyage to the archipelago in 1521 were amazed at the quantity and quality of gold the inhabitants possessed, and to the Europeans, valued so lightly.

Using similar techniques still employed by many so-called ‘artisanal’ miners, the moros, as the Spanish insisted on calling their newly colonised subjects, knew how to extract gold and then work it into fine ornaments in the same way the meso- and southern American civilisations did on the far side of the Pacific Ocean. Well before the Spanish arrived, gold and copper from the Philippines were traded into China, Japan and as far as India and represented the embryonic country’s principal export.

While the Spanish made the extraction of gold and silver their main economic priorities in the Americas, a combination of local resistance and other commercial opportunities in Asia blunted such efforts in the Philippines. Much of Spain’s trade in Asia for centuries was financed by silver extracted from El Cerro Rico (‘Rich Mountain’) mines in Potosi, now a city in Colombia.

The glacial pace of Spanish economic reformism was driven by the mineral wealth of the Americas. It has been credited for maintaining a semi-feudal aristocracy and an unproductive hidalgo class of gentry who famously would, and did, starve rather than work, long after the rest of Europe was industrialising and introducing the social and political structures still evident today. The first laws regulating mining in the Spanish Philippines were promulgated in 1837, paving the way for the first ‘modern’ mine to open in Lepanto, Benguet province in Luzon’s mountainous cordillera region. The mine was developed on a site that has been providing copper and gold since at least the 12th century, with much of the output shipped to China.

The U.S. occupation following the defeat of Spain at the turn of the 20th century led to the arrival of far more assertive prospectors and technically adept mining companies which quickly recognised the scale of mineral deposits in the Philippines. They quickly set about exploiting the huge reserves of copper, gold, and nickel. The 1930s became the apogee of the country’s large-scale mining industry; by the outbreak of the Pacific War in late 1941 there were 40 gold mines collectively producing around 27, 215 kg of the refined mineral a year.

The 29 months of Japanese occupation wrecked much of the mining industry’s infrastructure. Rebuilding the sector postwar was challenging. Despite the Philippines gaining its independence from the U.S. in 1945, mining was still dominated by foreign enterprises, reflecting the lack of indigenous capital and technical expertise. Gold and copper remained the mainstay of the industry as it recovered in line with postwar reconstruction and rapid economic growth in Asia in the 1960s and 1970s.

However, the actions of the Marcos dictatorship between the 1970s and 1986 also led to the departure of many foreign – mainly U. S. companies – which had enjoyed privileged status held over from the colonial era. Around 15 major and medium-sized industrial ore mines closed during this period…

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