The government was urged to make sure that it is getting a fair share in the extraction of mineral resources.
In its 2013 Resource Governance Index, New York-based Revenue Watch Institute gave the Philippines a composite score of 54 out of 100, ranking it 23rd among 58 resource-rich countries surveyed for quality of management of oil, gas, and mining sectors.
The composite score was described as “partial,” next to “satisfactory” and above “weak” and “falling.”
Released last week, the index assesses the quality of four key governance components in natural resource management: Institutional and legal setting, reporting practices, safeguards and quality control, and enabling environment.
“The index finds that only 11 of the countries surveyed – less than 20 percent - have satisfactory standards of transparency and accountability,” the report said.
Revenue Watch said the Philippines ranked in the top half of countries surveyed on all four components, suggesting that the government has made meaningful progress toward improved resource governance.
Ranking on top of the index were Norway, the US and United Kingdom with composite scores of 98, 92 and 88.
At the bottom of the list were Equatorial Guinea, Turkmenistan and Myanmar with composite scores of 13, five and four.
As a way forward, Revenue Watch calls on governments of resource-rich nations to disclose contracts signed with extractive companies; ensure that regulatory agencies publish timely, comprehensive reports on their operations, including detailed revenue and project information; extend transparency and accountability standards to state-owned companies and natural resource funds; curb corruption and respect civil, political and freedom of the press; and adopt international reporting standards for governments and companies.
In its country-specific report, Revenue Watch said the Philippines’ natural mining resources include major copper deposits, chromium, gold, and silver.
“However, with low royalty rates and an ineffective fiscal system, the government receives only a small share of this resource wealth,” the report said.
Revenue Watch said the Philippines produced 11 percent of the world’s nickel supply in 2010.
Minerals made up eight percent of its merchandise exports in 2011, it added.
The government is preparing to legislate a new revenue sharing scheme to give the state a larger share of revenue from the extractive industry.
Revenue Watch recognized the good institutional and legal setting governing the extractive industry in the Philippines but noted the “notorious” delay in remittance of the revenue share of local government units hosting mining companies.
Revenue Watch also noted the “uneven disclosure of mining data” in the Philippines.
“The current administration provides more information than its predecessors,” the report said.
“Maps of licensing areas are posted online and copies of contracts can be requested from the director of the Mines and Geosciences Bureau. However, joint operating agreements between the state-owned Philippine Mining Development Corporation and private firms are not made public, and access to environmental impact assessments is still restricted.
“The central bank is the main source of data on production, foreign direct investment, and mining exports. Local governments are less transparent, and their failure to accurately report on artisanal mining skews national statistics.”