Diokno backs reopening of closed mines

By Mayvelin U. Caraballo, TMT July 27, 2020

https://www.manilatimes.net/2020/07/27/business/business-top/diokno-backs-reopening-of-closed-mines/746463/

Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno is pushing for the reopening of closed mines to boost the country’s gold reserves.

During an online meeting with members of the House Committee on Economic Affairs last week, Diokno said he is in favor of allowing the mines ordered closed by former environment secretary Regina Lopez in 2017 to resume operations.

To recall, the Department of Environment and Natural Resources announced earlier its plan to allow the closed mining companies to reopen, which it said have already corrected their violations.

“We have to encourage the reopening of mines closed by Gina Lopez. I think it is about time to reopen because we can earn more (from gold production). Gold price is now at $1,800. Its already high,” Diokno told lawmakers.

He emphasized that 10 percent of the country’s gross international reserves (GIR) are gold holdings. Thus, the central bank chief is encouraging the production of more gold.

Diokno also lauded Congress for a landmark legislation that seeks to strengthen the country’s GIR by helping local small-scale miners who sell gold to the BSP.

“Because of that law, we saw a pick up in gold holdings,” he said.

Republic Act 11256, which was signed on March 29, amends the National Internal Revenue Code to exempt from taxation income derived from the sale of gold by registered small-scale miners to the monetary authority.

Also covered by the law are small-scale miners who sell gold to accredited traders for the eventual disposal to the Bangko Sentral.

Meanwhile, the law said the sale of gold by small-scale miners to traders for eventual sale to the central bank would enjoy the same tax treatment and privileges given to the direct sale of gold to the Bangko Sentral.

Preliminary BSP data showed that the GIR reach a record $93.31 billion at end-June, 0.03-percent and 9.87-percent higher than the figures posted a month and a year earlier, respectively.

The figure also exceeded the previous record-high level of $93.28 billion in May and the Bangko Sentral’s $90-billion forecast for this year.