Investments in the Philippines' mining industry fell 35 percent last year after the government stopped issuing new permits, officials said Monday.

 

Foreign and domestic mining investment dropped to $618.5 million last year, from $956 million in 2010, said Leo Jasareno, head of the government's Mines and Geosciences Bureau that oversees the industry.

 

"We have a moratorium on new exploration applications. It is a logical extension that there would be no more new mining projects," Jasareno told AFP.

 

President Benigno Aquino's administration suspended the issuing of new permits in January last year as it began a comprehensive review of the sector aimed at ensuring the government received more revenues.

 

The government says it gets only a tiny share of mining companies' profits via a 2-percent excise tax, and is looking at models that would vastly increase the amount returned to state coffers.

 

The Philippines is believed to have some of the biggest mineral reserves in the world–the government estimates the country has at least $840 billion in gold, copper, nickel, chromite, manganese, silver and iron.

 

However the minerals have been largely untapped, partly because of a strong anti-mining movement led by the influential Catholic Church, while poor infrastructure, red tape and security concerns have also kept investors away.

 

Chamber of Mines spokesman Rocky Dimaculangan said the government's review, which still has not been completed, and the continuing suspension on new applications had scared off potential investors.

 

"This has a chilling effect. The moratorium is keeping investors away or giving them second thoughts about investing," he told AFP.

 

Jasareno said no date had yet been set for the release of the new policies, but that it would be soon and give certainty to investors.

 

"We anticipate everything will stabilize once the mining policy is issued by the president," he said. —Agence France-Presse