Dr. Emiliano Hudtohan

Educator, Business Writer, Industry Expert and Entrepreneur

Managing the Impact of the ASEAN Economic Community on the Mining Industry: A Quantum Perspective

Dr. Emiliano T. Hudtohan, AB-BSE, MA, EdD
Graduate School of De La Salle Araneta University, Malabon, Philippines
President, AcademiX2Business Consultancy, Inc.
Makati City, Philippines
International Seminar on the Socio-Economic and Environmental Impact of Mining
Paper to be delivered at the University of Pejuang,
Makassar, Konawe, Sulawesi, Indonesia
November 24, 2015
Edition November 10, 2015

Abstract:  The Asean Economic Community (AEC) Blueprint, which has four pillars containing 17 core elements and 176 priority actions, will be implemented by member nations in December 2015. This paper provides a heuristic insight on how the mining companies can locally strengthen their economic operation.  The mindset of the mining management is invited to move from a 17th century Cartesian-Newtonian paradigm to a 21st century quantum worldview.  Thus, the mining companies need to consider the AEC as a quantum organization in terms of its economic, political and leadership structure. It suggests that: a. the comparative advantage of David Ricardo be considered as an alternative to the current practice of competitive advantage and b. Martin Brown’s economic view on common wealth in contrast to commercial wealth be promoted for business sustainability. Subsequently, it proposes that the mining industry among members of the Asean superstruct locally to consolidate their resources; then regionally consider its role in the Asean region, and ultimately participate in a new global economy.

Key words: Cartesian-Newtonian physics, metaphysics, quantum theory, quantum organization, comparative
advantage, common wealth, and superstruct.

Objectives of the paper

This paper seeks to answer the questions: 1. How can the New Science of quantum physics help us appreciate the AEC as a new organization in the 21st century?  2. What is the alternative economic platform which will hasten the development of the Asean Economic Community?  3. What ae the challenges facing the mining industry in the face of a superstructure that is based on a new ecology of the future?

This is an exploratory paper, using heuristic approach to develop the topic on The Impact of AEC on the Mining Industry in Southeast Asia. Heuristic research attempts to discover the nature and meaning of phenomenon through internal self-search, exploration, and discovery (Moustakas & Douglass, 1985).  As an axiologist, I used my banking and insurance experience for 20 years and academic experience at the De La Salle College of Business teaching corporate social responsibility and business ethics for 10 years viewing the mining industry from a perspective of the New Science of management. My self-search, self-dialogue and self-discovery regarding mining has been ongoing for the past six years when I gave a talk on mining and social responsibility in Indonesia (2009 and 2011). In 2014, I delivered a paper on the challenges and opportunities of the AEC at the Halo Oleo State University, Kendari, Indonesia. With the implementation of the AEC Blueprint in December 2015, it is imperative that the mining industry, and similarly with other industries, be seen from a new perspective.

1.    The AEC as Quantum Organization
The impact of AEC
For the Asean member nations to be able to manage the impact of the Asean Economic Community (AEC), it is necessary to understand the implications of the new community in terms of 21st century perspective based on quantum organization, quantum economy, quantum politics and quantum leadership. Creating a new community means new organization, new structures and new governance.  On the ground, the AEC Blueprint inevitably makes an impact on existing organizations and structures of Asean members.

The word impact is defined by Google as a noun and a verb.  As a noun, impact means “the action of one object coming forcibly into contact with another.” It is synonymous to synonyms: collision, crash, smash, bump, bang, an knock.  If the AEC is considered as concept that is forcibly coming into contact with Asean members, then there can be a collision, smashing, banging and knocking events. As a verb, it means “to have a strong effect on someone or something.” It is synonymous to consequences, repercussions, ramifications, reverberations.  The AEC Blueprint will have primarily a strong effect on the economy of member nations, and ultimately on their respective political and social life.

The British dictionary sees impact as “a force or action of one object hitting another” or “a powerful effect that something, especially something new, has on a situation or person.” In effect, the Blueprint is coming forcibly into contact with the mining industry and the strong effect can be that of collision or a big bang. In the early 17th century impact means to “press closely, fix firmly” or to “driven in.”

From the various meaning of the word impact, the Blueprint can be considered a force that is driving in particular the mining industry among Asean member nations to create framework to manage the impact of the new AEC Blueprint.

The AEC Blueprint
The AEC will establish ASEAN as a single market and production base making ASEAN more
dynamic and competitive with new mechanisms and measures to strengthen the implementation of its existing economic initiatives; accelerating regional integration in the priority sectors; facilitating movement of business persons, skilled labor and talents; and strengthening the institutional mechanisms of ASEAN.(AEC Blueprint, II, 6, p.5)

A1. Free flow of goods

10. Free flow of goods is one of the principal means by which the aims of a single market and
production base can be achieved. A single market for goods (and services) will also facilitate the
development of production networks in the region and enhance ASEAN’s capacity to serve as a
global production centre or as a part of the global supply chain (AEC Blueprint, p.6).
Promotion and awareness: SMEs MNEs, and MNCs (AEC Blueprint, p.11)

Culture of fair competition, p. 18 Currently, only four AMCs (Indonesia, Singapore, Thailand and Viet Nam) have their own competition law and competition regulatory bodies. Malaysia has not passed any nation-wide competition law but has, instead, relied on sector-level regulations to ensure and enforce competition in markets. 56. Mining cooperation. Enhance trade and investment and strengthen cooperation and capacity in geological and mineral sector for sustainable mineral development in the ASEAN region.

i. Facilitate and enhance trade and investment in minerals;
ii. Intensify institutional and human capacity building in ASEAN geological and mineral sector;
iii. Promote environmentally and socially sustainable mineral development; and
iv. Encourage the participation of the private sector in mineral development (AEC Blueprint, p.22).

What is quantum organization?
In order to expand our respective national consciousness to a regional consciousness, as framed by the AEC Blueprint, I am offering a quantum perspective AEC as an organization and its impact on leadership that will drive the new political economy in this region.

The concept of quantum organization is based on a new paradigm of metaphysics as a New Science (Kilmann, 2006; Dator, Pratt, & Sea, 2006; Deardorff & Williams, 2006; Wheatley, 2006; Chopra, 2008; Karakas, 2009; Beck, 2014). This is in contrast to the Cartesian-Newtonian physical science.

Hookes (c2011.) graphically explains the two paradigms in Figure 1. He says, “This rooted-tree graph represents the partition of the world into its constituent people particles, as well as the resulting hierarchical political and social structures of the bourgeois state, and that of it main economic players, the corporations.”

He continues, “As we can see in the quantum theory (QT) paradigm, the circle on the right is a topological folding of the circle on the left. The nodes can be considered as problems-solvers within a Problem-Solving Intelligent network, that is, a PSI-net or Ψ-net7.  A ‘problem-solver’ node may be an individual, group of individuals, or else some intelligent software/hardware. In this case of the Ψ-net, they can be thought of as connected by an information channel with a given bandwidth. The original set is partitioned into sub-cycles (or subsets) and further into sub-sub-cycles (sub-subsets) and so on. In such structures information about the activity at each node, the collective activity of each subset (or sub-subsets) or the collective activity of the complete set of nodes can be accessed by each individual node. It just requires sufficient bandwidth. With modern
technology this is in principle almost infinite (actually terabits/sec and increasing…). The important point is that relationship of each part can be consciously related to the whole. This helps to solve the problem of the alienation of the isolated problem-solver in the tree-like hierarchies of bureaucratized reason (Weber, 1978), as illustrated by the left-hand CN-net. In the latter, the problem-solver usually does not understand how her sub-sub-problem relates to the main problem or the other problem solving activities. Only those in the top layer have an overview.”

Political Economy

Hookes (c2011) explains quantum theory as an alternative to Cartesian-Newtonian paradigm.  He says, “What is understood by only a very small number of the critics of modern corporate capitalism is that modern physics, and, specifically, quantum theory, provides an alternative paradigm, or framework of thinking, that can help demolish that of Cartesian-Newtonianism (CN) in the politico-socio-economic sphere as well as that in physics itself.”

In Figure 1, CN on the left side is a capitalist view of the political economy while the one on the left is a QT view of the political economy. Notice that Marxian is used and not Marxist because this is a new interpretation of Marx’s thoughts in quantum science and not necessarily
dialectical philosophy. According to Hookes (c2011, p, 13), “The quantum paradigm (on the right], represents the account of the global capitalist productive process given by Marxian political economy. In this picture we can see that the labour and value produced at each node in connected to all other nodes through the global market exchange system to create both a global (universal) labor and global (universal) value system. Labour carried out locally becomes de-localized; value created locally becomes de-localized through the global market system of capital.”

I think the lesson here is that the Marxian political economy offers a social economic paradigm which allows the clustering of similar labor and products in mining, so that it becomes an efficient structure for global enterprise.  It must be pointed out that the QT paradigm is non-hierarchal, non-alienating, cooperative and democratic.  Cartesian-Newtonian paradigm and the New Science of metaphysics are extensively discussed by Whitely in  Leadership and the New Science,  Beck’s Finding Your Way in a Wild New World, Deepak Chopra’s Grace and Freedom, and Karakas’  New Paradigms in Organization Development: Positivity, Spirituality, and Complexity.

In many ways, QT paradigm supports the social innovation (Godin, 2012) which promotes structural reforms (economic, political and social) that will benefit the many (traditionally termed as common good).  Here, Hooke is very selective in using the term Marxian, as opposed to Marxist which has a socialist and even worse implying communist ideology.

In the Philippines, socialism raises the spectre of communism (Murphy, 2015), which is an ongoing concern in provincial areas where insurgency continues to be a problem.  In the business and marketing sector, socialist inclination of a capitalist is now labeled as democratization of the market, or the practice of social marketing.  There is much acceptability in the business sector when it comes to corporate social responsibility, which is now enshrined in business school curriculum.  Social innovation from the corporate sector in the Philippines is opening up towards democratizing business as the trend for social entrepreneurship gains good ground.  In fact, CSR is now moving towards corporate shared value (CSV) with the community and towards corporate social initiatives (CSI).  The concept of democratization and socialism in business is converging without Marxian, Marxist, socialist, and communist undertone.

Asean quantum politics

Dator, Pratt, and Sea (2006), on current political governance reforms said, “They are cosmologically inadequate because they are all based on old “Newtonian” notions of causality and intentionality. It is essential that new forms of governance be based on what the best science and humanities of all cultures can tell us about human and other systems, artificial as well as natural. 2. They are technologically inadequate because they were invented at a time when communications technologies were quite different from what they are now—initially limited to human speech and handwriting, later augmented by the very labor-intensive and slow printing presses of the day. At that time, literacy was low, books were few and rare, and newspapers little more than a few pages of local announcements and opinion.”

In an interview by Jake Dunagan for the Ten Year Forecast of the Institute for the Future, Dator (2009)
describes quantum politics in terms of cosmology and technological innovations of the 21st century.  He said, “[I]n a normally operating society, there is a close relationship between the dominant cosmology, the dominant technology of the time, and the social institutions and social values of the group.  That relationship has characterized almost all societies up until probably the 20th century.  What happened in the 20the century is that a new cosmology called quantum physics – and the new technologies of the electronic information and communications revolution – became out of sync with many social institutions and practices specifically with governance systems, which are still very much locked into technologies of 200 years ago” (Dator, 2009).

Quantum leadership

The 2013 assessment of Asian Development Bank in Asian Economic Integration Monitor states that: “The success or failure of the AEC ultimately lies in the hands of the national decision- and policy-makers who make it happen, and who have the political backing to overcome vested domestic interests that stand to lose from liberalization…The flexibility that characterizes ASEAN cooperation and institutional arrangements could give member states a pretext for non-compliance – and these are enforcements issues.  This is the key challenge to be overcome in realizing the AEC as more than a political exercise in solidarity.”

As of October 31, 2015 at the 27th Asean Summit in Kuala Lumpur, Le Luong Minh, Secretary General of ASEAN reported that the overall implementation of the AEC Blueprint is 92.7 percent complete.  This means that 4v69 of the506 measures have been accomplished. This is a far better performance based on March 2012 data on the four pillar of AEC showed the following accomplishments: 1.Single Market and Production Base is 66%, 2. Competitive Economic Region 68%. 3. Equitable Economic Development is 67%, and 4. Integration into the Global Economy is 86%.  The overall performance of AEC reached is about 68% of its overall targets between 2008 and 2011.  Le Luong Minh, Secretary General of ASEAN says as of 2014 implementation is already 80% (Oxford Business Group, 2014).

The biggest strides have been made in integrating into the world economy Pillar 4 registered 86%. This is due to the fact that that ASEAN economies trade mostly with the rest of the world. According to Hill and Menon (2013), since 1970, intraregional trade has generally been between 15% and 30% of total ASEAN trade, and while the  has been trending upward, it remains low in comparison with the shares of ASEAN’s external trading partners, particularly the European Union. (Hill and Menon 2012).

According to the Asian Development Bank (ASEAN Economic Monitor, 2013), there are five key drivers to the AEC integration: 1. Political will, 2. Coordination and resource mobilization, 3. Implementation and arrangements, 4. Capacity building and institutional strengthening, and 5. Public and private sector consultations. The Asean quantum leader is expected to be the driver in AEC integration.

Deardorff and Williams (2006) say that within the quantum organization are three tiers or levels of interaction which are the self, the motions of Fluidity and the leader. The intersection of all three of these elements is the quantum node where synergy is created to produce innovation and novel, new ideas.

They argue that synergy leadership is a process where the interaction of two or more agents or forces combined effect is greater than the sum of their individual effects. In effect, there is an evolving phenomenon that occurs when individuals work together in mutually enhancing ways to achieve success by inspiring one another to set and accomplish both personal goals and a group vision. They further noted that “The easiest area to describe but hardest area to recognize in the quantum organization is the self. The self of the leader is ultimately the key to the success of the quantum organization model.

Thus, one’s personality, energy, spirit, quirks and experiences comprise the uniqueness  of the Self.  What is needed is a measurement rubric, tool or instrument that can create a quantum measurement capturing these features. This measurement will determine impact of the Self on quantum organization.  The Self will have the ability to accept and move with chaos and dynamic change can only be channeled constructively by utilizing the Self’s ability to accept accountability for the interactions; communication and dynamic ability make transformations in a chaos filled word.

Laszlo (2006) announced that we have already reached the chaos point and Braden (2009) mathematically showed that 2012 was the beginning of a new age based on the Mayan calendar.  Page (2008) averred that in 2012 Mother Galactica is entering into a black hole, where change and rebirth will be experienced thereafter.  The AEC’s birth in 2015 is an opportunity to make a breakthrough for future survival.  Wheatley (2006) suggests that the leader of the 21st century must take cognizance of the new science and pay attention to chaos theory.  Chaos causes disequilibrium and disorder but equilibrium which stablelizes can lead to complacency and stagnation. Chaos theory has been identified by Sardar and Abrans (2004) with ancient wisdom of Chinese yin-yang creative energy, 8th century Greek theogomy of how the first chaos came to be up until modern concept of randomness and unpredictability in the universe (Mapes, 2003;Taleb, 2010).

Kilmann (2006) observed that: “What were once simple problems that could be solved by extreme specialization have become complex problems that challenge fragmented categories. To succeed in the new millennium, accordingly, requires holistic categories that will enable members and their organizations to (1) clearly see the flowing interconnections surrounding the globe, (2) consciously think about interconnected problems in comprehensive ways, and (3) purposely behave in a manner that stimulates the meaningfulness and coevolution of life and nature throughout the world and the expanding universe. Seeing, thinking, and behaving with new—holistic—categories requires a mental revolution in self-aware consciousness…. We live in an interconnected world yet suffer from acute fragmentation.”

He “provides a deep understanding of a new paradigm with self-aware consciousness at center stage and offers a completely integrated program of eight tracks for effectively—and compassionately— accelerating self-aware consciousness in complex systems. By applying these insights and tracks, it is possible to create quantum organizations and thereby achieve success, happiness, and meaning.”

2.    The Mining Industry and the New Economy

Mining as common wealth

South East Asia will slowly emerge to become one of the main growth drivers in Asia’s mining sector.  The total value of mineral exchanges in Asean has multiplied by 10 in the past decade, going from US$ 4.1 to 43.1 billion between 2000 and 2011. Asean made up for 10.3% (South East Asia Mining Industry, 2013). Indonesia is second exporter of coal and nickel in the world, first in Asean; its coal makes up for 9% of exports globally and 95% of exports from Asean; its turnover is from US$56.8 billion in 2009 to a projected US$143 billion in 2016;  it has a repository of coal equivalent to that of the US, and its main minerals are coal and nickel.

The Philippines is fifth richest country in the world in minerals which include nickel, gold and copper; its turnover is from US$2.3 billion in 2009 to a projected US$7.8 billion in 2016;  its main minerals are nickel, gold and copper. Vietnam is set to become a major player in the global aluminum raw material market with the opening of the US$460 million Tan Rai alumnina refinery in December 2012; it is estimated deposit of 2.1 billion tonnes of bauxite, and prospection has shown reserves in minerals such as copper, iron, nickel, and tungsten. These impressive figures make Indonesia, Philippines and Vietnam targets of mining competition.

There is repeated use of competitive advantage thrives in a CN business paradigm but comparative advantage is more appropriate in a QT paradigm.  With the clustering of mining companies, the question of monopoly and oligopoly may be justifiably raised.  However, with the rise of corporate social responsivity, the movement towards corporate shared values, the proposal for corporate social initiatives and social enterprise, the negative effects of monopoly will be properly addressed for the benefit of common good (Hess, Rogovsky, Dunfee, 2002; Porter & Kramer, 2006; Kramer, 2008; Porter & Kramer, 2011; Pfitzer, Bockstette, & Stamp, 2013).

In the context of common wealth, is monopolistic economy being workable in the future? Monopoly within the purview of Marxian political economy, comparative advantage, social innovation, and corporate social responsibility need not be an economic monster of the 21st century.  The question of global survival in the face of impending environmental chaos leading to the destruction of Mother Earth, the mining industry must consolidate its strategic presence in the future.

The editorial of The Philippine Star (August 30, 2015) announced, “In just four months the ASEAN Economic Community will be in place, opening opportunities in a market of 650 million but also threatening the survival of those unprepared for competition…Open competition will break monopolies and oligopolies that often lead to lousy goods and services…radical change can lead to disaster or opportunity.”

The core of the Asean Economic Community is not only economic activity.
The primary focus should be on what a community is.  The mining industry must be considered a mining community.
Today, the concept of community in multistream management is “characterized by its emphasis on multiple forms of well-being for multiple stakeholders… [where] any group or person within or outside an organization…is directly affected by the organization and has a stake in its performance” (Dyck and Neubert, 2011, p. 16).

The AEC may consider Marvin T. Brown’s (2014) common wealth proposition. He says, “In a commercial society, what counts as wealth is what can be treated as a commodity in the market.  In a common society, wealth will not be limited to what we can purchase, but will include all that we need for a good life…Instead of focusing on the accumulation of property; the focus will be on the making of provisions.

A common society will provide for one another through process that are based on shared endeavors…A common society will also allow us to recognize the planet as a living provider instead of only seeing its property value.  Most importantly, instead of treating the planet as an object we control, we can see it as something to which we belong.  This means that inhabitants of the planet can relate to one another not primarily as owners, but rather as members of a commons” (Brown, 2014, p.37).

The mining industry is challenged to create a civic platform for commonwealth.  Brown suggests answering the following questions: 1. how should we design an economy that makes provisions for everyone? 2. How should we deal with disagreements among citizens? and 3. How should we govern a civic commonwealth?  Brown (2014, p. 44) believes that “The work ahead is the work of citizens, who through civic conversations give shape to a viable relationship between the commons and the commercial.  Business leaders can participate in this work by exploring the role of their business in a particular system of provision.  Ethicists and others can help to facilitate such conservations, so that civic defines our commonwealth rather than the commercial.”

Community is a union of consciousness; it is about our humanity in this region.  And our economic community based on material exchange must never exclude our transcendental relationships that bind us together in Asia and around the globe.

Mining and comparative advantage

David Ricardo’s (1817) theory of comparative advantage suggests that a nation should concentrate solely on those industries in which it is most internationally competitive, trading with other countries to obtain products which are not produced nationally. This means that industry specialization and international trade always produce positive results.

Philippine DTI Undersecretary Adrian Cristobal, Jr. (2014) describes the AEC a vast opportunities for growth, dynamic competition as well as complementation.  I translate ‘complementation’ as a comparative advantage.
Although Sec. 8 of AEC Blueprint talks about the region as a community, it in the same breath identifies the region under Item b. as “a highly competitive region.”

I believe it continues to subscribe to the Smithian theory of competitive advantage.  The AEC Community has the greatest opportunity now to make Ricardian comparative advantage work in this region. Article 8 of AEC Blueprint states that “the AEC envisages the following key characteristics: (a) a single market and production base, (b) a highly competitive economic region, (c) a region of equitable economic development, and (d) a region fully integrated into the global economy. (AEC Blueprint, p. 6). In addition to the current practice of competitive advantage, there is a need to study and experiment with comparative advantage to balance individual ASEAN member’s exclusive economic growth at the ‘expense’ of other members.

The Asean region can be competitive vis-à-vis the Western global market.  But regionally, it must do its homework in promoting a comparative advantage among its industrial economic engines.  The question then arises: Will mergers and restricting of the companies be moving towards monopoly? We must keep in mind that the objections against monopoly is based on protecting the very core of democratic capitalism, where the concept of free enterprise and the laissez-faire principle are the guiding spirit of business.

The rise of social innovation has opened the door to socialist capitalism of China and social entrepreneurship as alternative courses of business development and practice.  In a monopolistic Chinese owned business corporation, the trend now is mandated corporate social responsibility to address the plight of the poor

3.    Superstructuring AEC

Local Integration

The mining industry, in the context of AEC blueprint calls for the “mineral sector for sustainable mineral development in the ASEAN region. It is the position of this paper that comparative advantage be promoted instead of the classical competitive advantage that has permeated in the business sector with a view for bottom-line profitability.  The comparative advantage must first happen at the national level where some kind of integration among the mining industries will strengthen top performers and illuminate laggard performers.

By analogy, I am using the experience of the banking sector of the Philippines, when in 1991 a major decision was made by the Monetary Board of the Central Bank of the Philippines to rationalize the many universal banks in the Philippines.

The idea was to have top ten high banks with capitalization and assets comparable to the Asean and global banks. Thus, from 1991 to 2001 a period of mergers took place.   In 2015 the  top ten banks in the Philippines  are: 1. BDO, 2. Metrobank, 3. BPI, 4. Landbank, 5. RCBC, 6. DBP, 7. PNB, 8. Chinabank, 9. Unionbank, and 10. Security Bank (http://philpad.com/).

The government policy to rationalize the ownership and operation of the mining industry can only make sense if it pursues David Ricardo’s comparative advantage theory and common wealth theory.

Today, there is initiative in Philippine congress and senate to rationalize of the mining industry in the Philippines.

The history of the SEACEN began in February 1966, as a group of governors of some South East Asian central banks met in Bangkok, Thailand, to exchange information and ideas on matters affecting their economies and financial systems. The meeting was attended by 7 heads/representatives of the central banks and monetary authorities of Laos, Malaysia, the Philippines, Singapore, Sri Lanka, Thailand and Vietnam. Since then the Conference was held annually with the member banks of SEACEN playing host by rotation.

Philippine mining status

The Philippines has to rationalize its mining operations in relation with large and small-scale.  Large-scale mining. Viloria (2015) reported that  in 2012 there were about 317 business establishments engaged in mining and quarrying wherein about 218 were non-metallic producers and 27 metallic mines were engaged in the production of gold, silver, copper, nickel, chromite, zinc and iron ores based on  roster of the Chamber of Mines of the Philippines (2015) as shown in Table 1.

Table 1

Regular Members-Metallic in the Philippines

1, Apex Mining Co., Inc.Compostela Valley, DavaoGold & Silver
Asiaticus Management Corp.Davao OrientalCopper, gold, silver & nickel
Atlas Consolidated Mining & Development Corp.CebuCopper concentrates
Benguet CorporationBaguio, Zambales, Bataan, Apayao Zamboanga & SurigaoGold, silver, nickel, coal & iron ore
Berong Nickel CorporationPalawanNickel laterite ore
Coral Bay Nickel CorporationPalawanNickel/cobalt mixed sulfide
C.T.P. Construction & Mining Corp.Carrascal, Surigao Del SurNickel Ore
Zambales Diversified Metals Corp.ZambalesNickel, copper, gold
Eramen Minerals, Inc.ZambalesNickel
10.Filminera Resources Corp.Aroroy, MasbateGold
11.Hinauan Mining Corp.Eastern Samar & Surigao Del NorteNickel
12.Lepanto Consolidated Mining Co.Mankayan, BenguetCopper, gold & silver
13.Marcventures Mining & 14.Development Corp.Butuan CityNot stated
Manila Mining Corp.Placer, Surigal Del NorteGold, copper & silver
Nickel Asia Corp.Palawan, Taganito, Hinatuan, SurigaoNickel
OceanaGold (Phils.), Inc.Nueva Vizaya/QuirinoCopper and gold
Pacific Nickel Phils., Inc.Nonoc, Surigao Del NorteNickel
Philex Mining Corp.Padcal, Tuba, BenguetCopper, gold & silver
Phil. Associated Smelting & Refining Corp.Isabel, LeyteCopper cathodes
Philsaga Mining Corp.Davao & Agusan Del SurGold
Platinum Group Metals CorpClavel, Surigao Del NorteNickel
Rapu-rapu Minerals, Inc./KMP Resource Inc.AlbayCopper, gold, zinc & silver
Rio Tuba Nickel Mining CorpPalawanNickel
SR Metals, Inc.Agusan Del NorteLaterite nickel ore
Taganito Mining Corp.Claver, Surigao Del NorteNickel ore
27.TVI Resources Development ( (Phils.), Inc.ZamboangaCopper, gold & silver

Source: Chamber of Mines of the Philippines 2015

Villoria (2015), citing Philippine Statistics Authority 2014 report, noted that the mineral sector of the Philippines is basically export-oriented with Japan as its main market and other markets include China, United States of America, Canada and Hong Kong.

The mining industry, as of first quarter of 2015, has contributed 6.1% share to total exports amounting to U.S. $862 million (MGB Mining Industry Statistics, 2015). The Philippine Government collected Php376.3 million of taxes, royalties and fees from mining in first quarter of 2015.  Hence, the industry plays an important part in economic development (Viloria, 2015).

Superstructuring the mining industry

The New Science of quantum theory, Hooke’s (c2011) Marxian economy, Brown’s (2014) concept of common wealth, Ricardo’s (1871; 1951) comparative advantage and Li Zhang’s (2012) cross-strait economic interdependence and cross-strait political relations based on neoliberalism and interdependency theory form a new perspective on why superstructuring the global, regional and local mining industry is most critical for its sustainable developing and the sustainability of the Earth as resource provider for mining.

Would it make sense that the global mining companies work for the comparable advantage of all by collaborating with the Indonesian, Malaysian, and Philippine mining companies?  The Glencore Xtrata, followed by BHP Billiton, Rio Tinto and Vale recorded the biggest revenue from mining operations in 2013. Mining-technology.com profiles the world’s ten biggest mining companies based on revenue earned in calendar year 2013.

Indonesia has outstanding gold mining companies: PT Aneka Tambang Tbk, Aurora Gold Ltd (Indonesia), Austindo Resources Corporation NL (Indonesia), Batu Hijau copper-gold-mine, Golden Valley Mines NL, PT Antam Tbk, PT Kelian Equatorial Mining, and PT Newmont Nusa Tenggara (MBendi Information Services). Malaysia has top mining companies: Peninsular Gold Ltd., CNMC Goldmine Holdings, Ltd., PT Bukit Makmur Mandiri, Monument Mining Ltd., and Olympus Pacific Mineral, Inc.  The question is how to superstruct the mining industry.

The Asean Economic Community is just a beginning of an ambitious attempt to make Asia a sustainable civilization in contrast to the weathering away of North American and European civilization. As we restructure our economy, we are challenged to further restructure our socio-political life in the region. Visionaries have suggested that we superstruct to facilitate and enable us to fulfill our dream of an AEC in 2020. To superstruct means: [T]o build new structures that extend our reach, expand our capacity, and go beyond the limits of today’s institutions.

It means to bridge, to traverse boundaries, not just of organizations, communities, or nations, but also of scale itself.  It also means finding new kinds of value in new kinds of social production and new forms of social connectedness.  In fact, superstructing is all about building a new level of sociability into our economic lives – and into all our projects, from securing food and shelter to governing ourselves (McGonigal and Vian, 2009). The superstructuring, however, has a direct impact on the mining industry.

Superstructuring: Regional and Global

The foundation of superstructuring the region and the global community is quantum politics.  Dator (2006) According to McGonigal and Vian (2009), the heart of superstructing is “collaborating across scales, from the micro to the massive.

Superstructing is not just about big; it’s also about very small contributions by many individuals that add up to something big.  We can apply practical strategies to the millions of interactions that make ecology sustainable.  We can work small to create big effects.  And we can leverage massive platforms to create much targeted value in select places in the ecology.”

There are five key areas which the mining industry must consider, if it wishes to be sustainably operational in the 21st century. The Insitute for the Future suggests: 1. The Appleseed Ecology which proposes ‘simfarms’ structures for securing food, repurposing wastes, and crating new forms of exchange. 2. The Natural Currency Ecology which re-envisions our capital systems as tied, not to gold or GDP or other commodities, but to environmental measures, linking sociability to sustainability. 3. The Community Works Ecology which advocates that large scale problems do not require large scale solutions; it means creating superstructures for replicating local solutions across large-scale systems. 4. The Open Fab Initiative Ecology starts a node for linking small-scale fabrications and practices to solving problems of distressed communities – creating a new local material and economic realities. 5. Quantum Governance Ecology is building a desire to create a new post-Newtonian model of governance that will help citizens make sense of the world – bridging across realities” (Superstruct Handbook, 2009).

Of the five ecologies, the most critical to the mining industry is the natural currency ecology.  If gold will no longer be the global currency, will mining be economically sustainable by then?


The QT paradigm challenges the mining industry to step up its organizational structure in order to cope with the challenges of the AEC Blueprint.  It must be address the following issues:

First, this paper poses a challenge to the corporate leaders and engineers, who are steeped in the physical science of  Rene Descartes and Isaac Newton.

Are they willing to explore the new science of quantum physics as a dimension of their profession?

Second, the AEC Blueprint calls for new leadership in the 21st century.  Quantum leadership posits a way to create synergy among teams, corporations, communities and member nations of the Asean.

Third, the challenge among Asean member nations is to figure out a political economy based on quantum theory of the science of metaphysics. The hegemonic nature of AEC calls for a new economic and political order that will allow implementation of the AEC Blueprint beginning December 2015.  Fourth, member nations must remember that as early as in 1955 the Bandung Conference in Indonesia asserted the Asia is for Asians; then, there was the Association of Southeast Asia (ASA) formed by the Philippines, Thailand, and the Federation of Malaya in 1961; the formation of Maphilindo (Malaysia, Philippines and Indonesia) in 1963 and the creation of SEATO (South East Asian Treaty Organization) pushed by the United States America for military alliance in 1954. Fifth, Asean leaders need to create a new consciousness in this region by exploring their respective cultural values that were degraded and erased by the Western colonials. This means bayanihan in the Philippines, gotong-royong in Indonesia and Malaysia, and the Buddhist dharma in Thailand (Sharma, 2013).

Sixth, the Asean member nations must re-visit the history of the region when the Majapahit Empire that ruled from 1293-1500 (www.rumormillnew.com/pdf/The-untold-story-of-Maharlikans.pdf) under the Royal Kingdom of the Marlikhans. According to the Nagarakretagama (Desawarñana) 1365 document, the Majapahit empire stretched from Sumatra to New Guinea and it included present day Indonesia, Singapore, Malaysia, Brunei, Southern Thailand, Sulu Archipelago, Manila, and East Timor (http://dbpedia.org/resource/ Majapahit). This is a historical basis for the Asean Economic Community. Seventh, it is important to note that No.2 of superstructuring of the Institute for the Future specifically mentions a revision of capital system no longer tied up to gold.  What, then, are the production and the economic implications of this projected global currency to the mining industry?

In closing, the question I ask then is: Can we steer our economic community towards a moral economic community that truly cares for every member of civil society in the ASEAN region? The answer: The Institute of the Future has a superstructuring game.  I highly recommended we play it to have a foothold on the superstructure we call the ASEAN Economic Community which we are starting now. We want to operationalize the four pillars that contain 17 core elements and 176 priority actions by 2020.

Quantum Theory of the New Science of metaphysics was presented as an integrating framework for the Asean member nations to consider. It is a departure from the old way of seeing things based on Cartesian-Newtonian paradigm.  The 21st century calls for a new political economy, which is based on quantum organization, quantum leadership and quantum politics.

The local, regional, and eventually global integration challenges the existing economic fundamental of Adam Smith’s construct of the Wealth of Nations.  The challenge of creating a Common Wealth needs to be addressed as it is diametrically opposed to our current concept of Commercial Wealth.  The threat of global warming and impending climate change will for us to think globally is we wish to have economic sustainability for a sustainable civilization, no longer as member nations but as inhabitants of the planet Earth.


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Dr. Emiliano T. Hudtohan, AB-BSE, MA, EdD is a retired professor of De La Salle University, Manila College of Business; he currently teaches at the De La Salle Araneta University, Malabon Graduate School, San Beda College Graduate School and De La Salle College of St. Benilde Graduate School, Metro Manila, Philippines.  His field of interest and expertise is business ethics and corporate social responsibility. He has delivered papers on mining sustainability and corporate social responsibility at the international seminar  in Unaaha, Konawe and recently a paper on Asean economic integration and corporate social initiatives at Halo Oleo State University, Kendari, Sulawesi, Indonesia.  He was a columnist of Manila Standard Today. He is president and co-founder of AcademiX2Business Consultancy, Inc.

Appendix 1

Newtonian Physics and Metaphysics [Quantum Physics: Martha Beck (2014), F. Karakas (2009), and Deepak Chopra (2008)]

Martha Beck (2014) comparative worldview on spent old world and wild new world, p. 285
Area of lifeThe spent old worldThe wild new world
Inner experience of individualsDominated by fearful stories.Saturated with the present moment
RelationshipsFaithful to arbitrary social standards of various cultures.Faithful to the truth of love within and between people.
CareersDependent on the repression of a human’s true nature.Dependent on the expression of a human’ true nature
IndustriesHuge organizations win by controlling destruction of goodsIndividuals and small groups create win-win ideas for innovative content creation
Technical innovationMachines designed to hoard and exploit nature, devouring resources.Machines designed to heal and preserve nature, renewing resources
Karakas (2009)Changing Paradigms of Organization Development, p.15
Old ParadigmNew Paradigm
Old sciences Newtonian, Linear, ReductiveNew sciences Quantum, Nonlinear, multiple truths, emergent
Profit orientation Competition, Economic, Short term, profit orientedMultiple orientations Cooperation, Social, environment, economic Long term, triple bottom line
Uniformity Hierarchical, Absolute, SelectiveDiversity Lateral, Contextualism, Inclusive
Command and control Top-down, controlling, doubtful and dominationFlexibility and empowerment Egalitarian, inspiring, trusting and collaboration
Certainty Clarity, order, stabilityUncertainty Ambiguity, chaos, change
Partial Atomistic, exclusionary, analysisImpartial Ambiguity, chaos
Old metaphors Clockwork, static box, machineNew metaphors Brain or ecosystem, dynamic flow, web/newnetwork
Deepak Chopra(2008) The Old and the New Paradigm, pp. 213-218
Old ParadigmNew Paradigm
Superstition of materialism: We are separate from our source and from one anotherUnified field of pur consciousness: We are connected to our source and to one another.
The world is composed of visible, solid matter and invisible, nonmaterial energyThe world is composed of one underlying unmanifest field of intelligence that manifests as the infinite diversity of the universe
Sensory experience – What we can see, hear, smell, taste or touch – is the crucial test of reality.The field of intelligence experienced subjectively is the mind; the same field   experienced objectively is the world of material objects.
Solid objects or visible clumps of matter, are separated from on another in space and time.‘Solid’ objects are not solid at all, nor are they separate from on another in space and time. Objects are focal points, or concentrations of intelligence, within the field of intelligence.
Mind and matter are separate, independent entities.Mind and matter are essentially the same. Both are the offspring of the field of pure consciousness, which conceives and constructs the whole world.
The body is a physical machine that has somehow learned how to think.Infinite consciousness somehow creates the mind and then expresses itself as the body. The body-mind is the field of pure of consciousness.
Human beings are self-contained entities with well-defined edges to the body.Human beings are inseparably interconnected with the patters of intelligence in the whole cosmos. At the most fundamental levels of nature, there are no well-defined edges between our personal body and the universe.
The human body is composed of matter frozen in space and time.The human body-mind is a changing-pulsating patttern of intelligence that constantly re-creates itself.
Our needs are separate from the needs of other living beings.Our needs are intrdependent and inseparable from the needs of other living beings.
The external world is real because it is physical. Our internal world is unreal because it exists in the imagination.The external world and the internal world are the projections of one Being, the source of all creation. Both are patterns of movements of energy within infinite consciousness.
The superstition of materialism says that we live in a local universe.The unified field of pure consciousness says that we live in a nonlocal universe.
Location in space is an absolute phenomenon.Everything in the cosmos is nonlocal, meaning we can’t confine it to here, there, or anywhere.
Location in space exists independently of an observer.Location in space is a matter of perception. Near or far, up or down, and est or west are only true from the vantage point of the observer.
The thinking mind is localized in the brain, and the body’s intelligence is localized in the nervous system.The thinking mind is part of a vast field of nonlocal intelligence that extends far beyond the reaches of the cosmos. The body’s intelligence comes from the same nonlocal field.
The superstition of materialism says that we live in a time-bound universe.The unified field of pure consciousness says that we live in a timeless universe.
Time is absolute phenomenon.Time is a relative phenomenon. Physicists no longer use the word time, the use the term space-time continuum.
Time is local, measurable, and limited.Time is nonlocal, immeasurable, and eternal. The fact that we can localize time is just a notion, a perceptual artifact based on the quality of our attention,
Humans are entangled in a vast web of tine that includes past, present, and future.There is no past or future, then and now, before or after; there is only the eternal moment. Eternity extends backyard and forward from every moment.
Time exists independently of an observer.Time only exists in the mind of the observer. Time is a concept, an internal dialogue we use to explain our perception or experience of change.
Thinks happen one at a tine. The world operates through linear cause-effectEverything happens simultaneously, and everything is correlated and instantly synchronized with everything else.
How we interpret our experience of time has an effect on our physiology.How we interpret our experience of time brings about physiological changes in our body. Entropy and aging are partly an expression of how we metabolize or interpret tie.
The superstition of materialism says that we live in an objective universe.The unified field of pure consciousness says that we live in a subjective universe.
The world ‘out there’ is completely independent of an observer.The world ‘out there’ does not exist without an observer; it is a response of the observer through the act of observation, we construct the world we live in.
Observation is an automatic phenomenon our senses are capable of interpreting an objective reality in an objective manner.We live in a participatory universe. We learn to interpret the world through our senses, and this brings about our perceptual experiences.
Our inner world and our outer world are dependent upon our relationships, our environment, and the situations and circumstances around us.Our inner world and our outer world interdependently co-arise depending on the level of vibration of our spirit.

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