World Mining Exploration News

Asean mining industry outlook up amid crisis

PROSPECTS for the Asean mining industry remain high despite the global economic crisis.

Major industry players participating in the 8th Asia-Pacific Mining Conference and Exhibition (APMCE) are confident that the demand for metals and minerals in developing and emerging economies, particularly China and India, will remain high.

Environment Secretary Lito Atienza shared the APMC participants’ optimism, saying the global economic crisis offers an opportunity for Southeast Asia to attract more interest in the region’s mining potentials.

He said because the world will not stop operations despite the fiscal crunch, the need for continuous supply will remain.

“We really believe that this can be an opportunity to attract financial support and investments, especially in mining. Remember, as the crisis lingers on, the price of minerals will also be appreciating. Minerals prices will go up again. The price of gold now is going up again.”

Atienza expects a sustained interest in minerals in general, especially gold and silver.

Romualdez’s outlook

His view was shared by Asean Federation of Mining Associations (Afma) and Chamber of Mines of the Philippines president Philip Romualdez, who said the minerals development sector takes a long-term view toward mineral development. “What they look for primarily even in difficult times like these are opportunities,” he said.

“At a time when the world is flush with cash and money, various funds from all over the world are looking for investments. Historically, the mineral sectors remain strong and vibrant; therefore, it is these sectors that are looked upon as areas for investment. It is true that a financial crisis is going on, but these prices that we see today are very much higher than historical average. We are still experiencing good revenues from mining projects,” he said.

Even if banks are closing down in Europe and those in the United States remain threatened, he said some banking institutions are still standing strong and are actually looking for opportunities for investment.

“It is true that banking institutions in general are having difficulties. But not all of them. There are still some strong financial institutions looking for funding opportunities,” he said.

“Surprisingly, local banks are in a very strong position, and are looking for opportunities to fund these projects,” he said.

Romualdez predicted that countries in Southeast Asia will continue to grow despite the financial crisis in the United States and Europe.

The Afma and the Chamber of Mines of the Philippines are hosting the three-day event, which will kick off on October 14 at the Sofitel Philippine Plaza hotel in Manila, with Vice President Noli de Castro delivering the keynote address.

The theme for the 8th APMCE is “Asean Mining: Fuelling Asia’s Growth”

The conference will focus on the need to ensure the growth of the mining industry in Asean, which hosts major mineral resources. Industry leaders and experts will discuss global and regional factors influencing the demand and supply of minerals and metals, particularly major markets of Asean—China, India, Australia, Korea and Japan.

Around 400 delegates, including chief executive officers, heads of exploration companies, investment bankers, industry analysts, government policymakers, from Afma-members, other Asia-Pacific countries and resource-driven countries such as Australia, Canada, China, India, Japan, Korea, the United Kingdom and the United States are expected to attend the conference, which is simultaneously being held with five other regional events on mining at the same venue this week.

This is the third consecutive year that the Philippines is hosting the APMCE, but the fist time the event is being held alongside the 2nd Asean Ministerial Meeting on Minerals and the 9th Asean Senior Officials Meeting on Minerals.

The collapse in the subprime mortgage market last year triggered the financial meltdown in the US last month, causing mayhem in markets across the globe.

Yet despite the fiscal crisis, the latest biannual World Economic Outlook report of the International Monetary Fund supports the mining industry’s confidence in the market. Emerging and developing countries will be the least affected by the crisis. Their economies are expected to post robust growth of 6.9 percent this year and 6.1 percent in 2009. The forecast for China is 9.3 percent next year.

According to Romualdez, Afma will coordinate with senior officials in drafting the Manila Declaration on Responsible Mining, which will be considered by the Ministers.

The 3rd Forum for Private Sector Cooperation on Minerals also kicked off on Monday.

The Asean ministers’ and senior officials’ meetings will tackle, among others, the status of the implementation of the Asean Minerals Cooperation Action Plan and the Ministerial Understanding on Asean Cooperation on Minerals approved in Malaysia in 2005, and the proposed Asean minerals trust fund.