Project Cost: PhP 8 million

Project Duration: 12 months (January 10 2018 – January 10, 2019)

Consultant: Resources, Environment and Economics Center for Studies

Background and Rationale of the Project

Mining is a major industry in Caraga Region contributing about 20.1 percent to Caraga’s GRDP (Philippine Statistics Authority, 2016) and is present in all five provinces.

Caraga has 25 mining companies (Mines and Geosciences Bureau, 2016) in operation as of December 2016 making it the mining capital of the Philippines. Agusan del Norte and Agusan del Sur have 2 each, Dinagat Islands has 11, Surigao del Norte has 6, and Surigao del Sur has 4. Twenty-one of these companies are holders of Mineral Production Sharing Agreements (MPSA); two have Mineral Processing Permits (MPP) and two are under Joint Operating Agreement (JOA). Of the 25, 19 mining companies conducted explorations during the year; 11 of which are under MPSA, eight have Exploration Permits (EP) while 6 have been shut down or suspended.

Direct employment in mining industry grew by 8.13 percent, from 28,513 in 2015 to 30,829 in 2016 (Mines and Geosciences Bureau, 2016).

However, mining has become a controversial and divisive issue. Behind mining’s economic contribution, its sustainability has been diminished by pollution through large consumption of water and energy to extract, process, and transport minerals (Fraser Institute, 2012; Wang, 2015).

Further, the impending closure of 17 mining companies (Mines and Geosciences Bureau, 2016) by the Department of Environment and Natural Resources (DENR) entails policy interventions to come up with alternative livelihood opportunities for the 12,718 employees that will be directly affected by the closure and 519 employees that will be affected by the cancellation order.

The absence of studies on the social, economic, and environmental impacts of mining in Caraga Region necessitates this project. Impact analysis has to be done to determine the extent of mining influence and contributions (or effects) to social, economic, and environmental aspects of the region.

Subsequently, determine potential investment opportunities as alternatives to mining especially in the areas of agriculture, fishery, forestry, eco-tourism, and industries that will lead the region into a knowledge economy. Further, come up with value chain analysis and investment portfolio for investors’ reference.

Objectives

This research aims to:

  1. Determine the extent of social, economic, and environmental impact of mining in Caraga Region
    • i) Social impact
      • Effects of mining operations on the socio-cultural aspects of the host and neighboring communities
    • ii) Economic impact
      • Effects of mining on the GRDP
      • Contributions of mining to local taxes and revenues and their utilization
      • Effects of mining on employment generation
      • How mining affects per capita income
      • Influence of mining on economic activities
      • Influence of mining on economic policies
    • iii) Environmental impact
      • Scale of mining operations and its effects on the environment represented in GIS maps
  2. Determine potential investment opportunities as alternatives to mining especially in the areas of agriculture, fishery, forestry, eco-tourism, and industries that will lead the region into a knowledge economy
    • i) What available resources have investment potential?
    • ii) Where these resources are (with GIS maps presentation)?
    • iii) How can these potential resources be tapped?
    • iv) What skills are needed to develop each investment potential?
    • v) What level of development is required in each investment potential?
    • vi) Are there existing government or private interventions on these resources? How else could these be tapped (skills needed and level of development required for each investment potential)?
  3. Develop value chain analysis for each identified investment potential
    • i) What products/services can be manufactured/produced from each potential investment?
    • ii) What are the competitive advantages or disadvantages of each potential investment?
    • iii) Cost-benefit analysis of each investment potential relative to mining
    • iv) What technologies are needed?
    • v) How much employment can be generated for each potential investment?
    • vi) What skills are needed in each value chain?
    • vii) What policy interventions are in place for each potential investment?
  4. Develop investment portfolio for each investment potential for publication
  5. Propose policies to expand economic opportunities and increase access to them
  6. Conduct Investment Congress
Scope of Work

The Consultant shall conduct the following activities in four parts:

Part 1. Determine the extent of social, economic, and environmental impact of mining in Caraga Region. Specifically, the Consultant shall determine:

  1. Social impact
    • How mining operations affects the socio-cultural aspects of host and neighboring communities
  2. Economic impact
    • How mining affects the GRDP
    • How mining contributes to local taxes and revenues and their utilization
    • How mining affects or contributes to employment generation
    • How mining affects per capita income
    • How mining influences economic activities
    • How mining influences economic policies
  3. Environmental impact
    • The scale of mining operations and how mining affects the environment represented in GIS maps

The results of the above activities will comprise the Socio-economic Impact and Environmental Impact Reports.

Part 2. Determine potential investment opportunities as alternatives to mining especially in the areas of fishery, agro-forestry, eco-tourism, and industries that will lead the region into a knowledge economy. Specifically, the Consultant shall determine:

  1. What available resources have investment potential?
  2. Where these resources are (with GIS maps presentation)?
  3. How can these potential resources be tapped?
  4. What skills are needed to develop each investment potential?
  5. What level of development is required in each investment potential?
  6. Are there existing government or private interventions on these resources?

The results of the above activities will comprise the Investment portfolio per province.

Part 3. Develop value chain analysis for each of the prioritized investment potential. Specifically, the Consultant shall determine:

  1. What products can be manufactured from each potential investment?
  2. What are the competitive advantages or disadvantages of each potential investment?
  3. Cost-benefit analysis of each investment potential relative to mining
  4. What technologies are needed?
  5. How much employment can be generated for each potential investment?
  6. What skills are needed in each value chain?

The results of the above activities will comprise the Value Chain Analysis and Cost-benefit Analysis reports.

Part 4. Propose economic policies and conduct Investment Congress.

Expected Outputs

Expected Outputs. The Consultant shall deliver the following outputs at specific time:

  1. Preparatory
    • Inception report. The Consultant shall submit a detailed plan of action and timeline for conducting the Project in the Inception Report.
  2. Part 1
    • Socio-economic and Environmental impact reports. The Consultant shall submit these reports after conducting Part 1 of the Project.
    • Capacity building. The Consultant shall capacitate NEDA-Caraga on the instruments and techniques used in conducting socio-economic and environmental impact evaluation. The Consultant shall prepare the Training Design and facilitate the conduct of the training.
    • Maps. The Consultant shall generate GIS maps needed for the Project and shall submit the corresponding shape files to NEDA-Caraga after completing the Project;
  3. Part 2
    • Investment portfolio. The Consultant shall develop an Investment Portfolio ready for dissemination in DVD copies (at least 500 pieces) and hardbound copies (magazine type: at least 200 pieces; leaflets: at least 500 pieces). Prior to publication, the Consultant shall submit to NEDA-Caraga the draft design of the Investment Portfolio for approval;
    • Maps. The Consultant shall generate GIS maps needed for the Project and shall submit the corresponding shape files to NEDA-Caraga after completing the Project;
  4. Part 3
    • Value chain analysis and cost-benefit reports. The Consultant shall submit this report after conducting Part 3 of the Project.
    • Capacity building. The Consultant shall capacitate NEDA-Caraga on the process of value chain analysis. The Consultant shall prepare the Training Design and facilitate the conduct of the training.
  5. Part 4
    • Investment Congress. Together with NEDA-Caraga, the Consultant shall conduct an Investment Congress. The Consultant, as the Resource Person, shall present the results of the research. While NEDA-Caraga shall serve as Secretariat.
  6. Completion
    • Completion report detailing the major research results. The Consultant shall submit a Completion Report detailing the results of the Project especially the proposed policies needed to expand economic opportunities and increase access to them and the conduct of the Investment Congress.

All required outputs shall be submitted in both electronic and hard copies except for the capacity building and investment congress.