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Bonanza Could Rival S. Africa Mines : Gold Rush Sparks Wealth and Misery in Philippines

August 12, 1986|MARK FINEMAN | Times Staff Writer

DIWALWAL, Philippines — Camilo Banad, an illiterate tribal hunter, was tracking wild boar through a virgin stream near the peak of Yellow Mountain here three years ago when something glittered in the river bed.

Banad bent down. He raked his gnarled fingers through the river pebbles and came up with a shimmering nugget the size of his thumbnail. Banad smiled. He recognized it at once. It was pure gold.

But not even Banad, a veteran mountain guide who knew the rivers and jungle trails of Yellow Mountain like the lines on the back of his hands, could foresee the tens of thousands of lives his discovery would touch--and the hundreds it would destroy--in the years to come.

On the morning of Sept. 23, 1983, Camilo Banad quietly started what is now the biggest gold rush in Philippine history. Quite by accident, he had stumbled onto what Philippine government officials now believe may well be the richest gold vein in the world, a deposit of thousands of tons of high-grade ore that has given renewed hope for economic recovery to the cash-strapped administration of President Corazon Aquino.

His find, which the government now predicts may eventually lead to a national gold industry that will rival that of South Africa, has created an employment boom in the heart of the Philippines' most economically depressed island, Mindanao.

Natural Resources Minister Ernesto Maceda, in signing an order legalizing small-scale gold mining for the first time, said it will create as many as 800,000 new jobs for the region.

"This might be the bright spot in our entire economic recovery program," Maceda said in a recent interview. And, using a phrase in the native Tagalog language, he added, "This is, as they say, hulog ng langit --a blessing from heaven. It's too good to be true."

It is, indeed.

If the gold rush that has turned Yellow Mountain and the rugged mining town of Diwalwal into a Wild West-style area reminiscent of the great California Gold Rush of 1849 is a blessing, it is a mixed one, at best.

In reality, it is a bonanza for some, built on the blood and backbone of thousands of the poorest of poor Filipinos. In a nation with a tradition of the rich taking from the poor, the scramble to capitalize on Diwalwal's high-grade ore has become a kind of paradigm of life in the Philippines today--a saga of exploration by exploitation.

Land Claims Stolen

Banad, who started it all, embodies much of that story. A Seventh-day Adventist, Banad said he "wanted to share my good fortune with others." His initial partners, wealthy nearby landowners, stole his land claims from him, and, today, he is still an impoverished peasant living in a plywood shanty on the side of Yellow Mountain.

So it is in Diwalwal today. The miners on Yellow Mountain do not own the mines. They are owned by the rich, many of them in the large towns and cities 2,000 feet below.

Those same businessmen also own most of Diwalwal, a mountainside shantytown of 6,000 crumbling huts, dozens of honky-tonk bars that blare the latest disco tunes, houses of prostitution where prices are double those in the nation's sophisticated capital of Manila, 575 miles to the north, and scores of gambling parlors and pool halls where players risk as much as 5,000 pesos ($250) on a single game.

So skewed are Diwalwal's prices that one enterprising and influential local politician who opened the town's first electric company four months ago charges a rate equivalent to 50 cents a day to power a single 50-watt bulb--and he collects his money daily.

Virtually none of the 50,000 people now considered permanent Diwalwal residents actually own any of the 204 makeshift mines that have been punched into the side of Yellow Mountain.

Lure of Riches

Most of them are, like Banad, poor peasants, families that flocked to Diwalwal for what Maceda called the "romantic possibility of get-rich-quick." They fled the poverty and hopelessness of Mindanao's cities and towns, where the statistics fall well below the national average of more than 50% unemployed or underemployed.

But when they reached this boom town, the hopeful prospectors discovered that they needed a lot of capital: money for payoffs to open mines that could not be licensed legally, money for tools and transportation, money to compete with even bigger money from the wealthy financiers in the nearby cities.

In Diwalwal, they are now called the abanderos, the mine people, and they represent the majority of the town's population. Men and women, they work 12-hour shifts at the bottom of narrow, 200-foot mine shafts that the government's Bureau of Mines has declared unsafe. Or they are the bearers who earn 15 pesos (75 cents) to carry 120-pound sacks of gold ore on their heads over several miles of mountain trails.

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