DAVAO CITY (August 15) — Mindanao could become one of the Philippines’ most important sources of the minerals needed to power the next generation of semiconductors, batteries, artificial intelligence and advanced manufacturing.
But behind that promise lies a harder question: will Mindanao capture the value of its mineral wealth—or once again bear much of the social and environmental cost while higher-value industries develop elsewhere?
The question is becoming more urgent as the Philippines moves to participate in Pax Silica, a US-led initiative seeking to secure supply chains for critical minerals, semiconductors, artificial intelligence and other strategic technologies.
The Philippines became the initiative’s 13th member in April. A proposed Pax Silica industrial hub is being planned on about 4,000 acres, or 1,620 hectares, in New Clark City, Tarlac, where the government hopes to attract advanced manufacturing, critical-mineral processing and AI-related investments.
The Bases Conversion and Development Authority has projected that the project could eventually attract US$40 billion to US$70 billion in investments and create as many as 190,000 jobs, although development of the hub is still years away and the investment and employment figures remain projections.
For Mindanao, the opportunity is obvious.
So is the danger.
Mindanao has what Pax Silica needs
Mindanao Development Authority Assistant Secretary Romeo Montenegro said the region could supply several inputs needed by the Pax Silica ecosystem, particularly nickel.
“Definitely, there are a number of production inputs that can be supplied from Mindanao. For instance, we talk about batteries. Around 90 percent of nickel ore produced in the Philippines comes from Mindanao,” Montenegro said.
Beyond nickel, Mindanao has deposits of copper, gold, silica and other minerals that are important to electronics and advanced industries.
The region’s importance is particularly visible in Caraga, one of the country’s major mining centers. Caraga has more operating metallic mines than any other Philippine region, with nickel operations making up a large share of its mining industry.
That makes Mindanao strategically important to a global economy increasingly hungry for the minerals behind electric vehicles, batteries, electronics, renewable-energy systems and AI infrastructure.
But being strategically important does not necessarily mean being economically empowered.
Montenegro said Mindanao’s nickel ore is shipped abroad, with the region lacking sufficient power-generation infrastructure to support large-scale processing and value-adding industries.
A smelting plant, he said, could require about 20 megawatts of electricity.
The implication is clear: Mindanao can supply the ore, but the industries that transform that ore into higher-value products may still be located somewhere else.
The old extraction model in a new technology race
This is where the Pax Silica discussion becomes more than an investment story.
The Philippines wants to move higher up the global value chain. Instead of exporting raw or minimally processed minerals, the government wants to attract industries capable of turning those resources into products with greater economic value.
But if the critical minerals are extracted in Mindanao and processed in Luzon or overseas, the country may improve its position in the global supply chain without substantially changing the economic position of the communities where those minerals originate.
The technology may be new. The extraction model could remain old.
That distinction matters because the costs of mining are not measured only in export receipts, taxes or production figures.
They can also be measured in forests cleared, watersheds altered, farms affected, fishing grounds placed under pressure and communities forced to negotiate changes to livelihoods and land use.
Recent investigations and rights reports have documented concerns involving nickel mining in Surigao del Sur and Dinagat Islands, including allegations of environmental degradation, threats to livelihoods and human-rights concerns. Climate Rights International said it interviewed 57 residents and workers near nickel mines in Caraga for its 2025 report.
Amnesty International has likewise raised concerns about inadequate consultation and risks to Indigenous Peoples and rural communities associated with the expansion of nickel mining in the Philippines.
These are allegations and findings from rights groups, not a blanket characterization of every mining operation in Mindanao. Mining companies and government regulators have their own environmental and social compliance mechanisms.
But the concerns underscore an issue that cannot be separated from Pax Silica:
Who pays when the world’s demand for critical minerals rises?
A cleaner technology supply chain can have a dirty beginning
There is an uncomfortable contradiction at the heart of the global technology and energy transition.
Electric vehicles, batteries, renewable-energy systems and advanced electronics are often promoted as part of a cleaner future.
Yet the minerals required to produce them must still be extracted from somewhere.
In Mindanao, that means communities in mineral-rich areas could face increased pressure to produce more nickel and other strategic minerals precisely because the world wants to accelerate its transition to advanced and supposedly cleaner technologies.
The benefits can be global.
The environmental and social costs, however, are often local.
This is why the conversation around Pax Silica cannot stop at investment figures and job projections.
It must include environmental safeguards, Indigenous Peoples’ rights, community consent, livelihood protection, mine rehabilitation, water security and the equitable distribution of economic benefits.
Otherwise, the country risks building a high-tech economy on a low-value and high-cost extraction model.
Power is more than an infrastructure problem
Montenegro’s warning about electricity highlights another structural weakness.
A mineral-processing industry cannot be built on mineral deposits alone. It needs reliable and competitively priced electricity, transportation networks, ports, water systems, industrial zones, skilled workers and technology.
Without those, Mindanao may remain the place where minerals are dug out while the value-added economy develops elsewhere.
That would be particularly troubling if the national government succeeds in building a massive technology ecosystem in Central Luzon while the resource-producing regions remain infrastructure-constrained.
The irony would be difficult to miss:
Mindanao supplies the minerals for the technology hub, but lacks the power and industrial infrastructure to build its own.
The social cost must be part of the investment equation
Pax Silica’s proponents point to jobs, foreign investment, technological upgrading and a stronger Philippine position in global supply chains.
Those benefits matter.
But a critical assessment must ask whether the projected gains outweigh the costs—and, more importantly, who receives the gains and who absorbs the costs.
Recent criticism of the proposed New Clark City hub has already raised concerns over its potential demand for power and water, environmental impacts, displacement and the adequacy of safeguards. Government officials have disputed some of these claims and said the project is being developed with environmental and community considerations in mind.
For Mindanao, the lesson should be straightforward.
If new mineral demand is created, communities should not be told that environmental and social costs are simply the price of national development.
The region should demand a larger share of the value chain in return.
That means more than mining jobs.
It means processing plants, downstream manufacturing, technical and engineering employment, research facilities, infrastructure investment and local enterprises that can remain after the ore is gone.
It also means ensuring that mining revenues translate into durable improvements in schools, health services, roads, water systems and livelihoods in host communities.
From supplying ore to building industries
Montenegro said MinDA is exploring ways to connect Mindanao to the planned Pax Silica ecosystem in Luzon.
A Board of Investments roadshow scheduled for August 24 is expected to include discussions on Mindanao’s possible role.
The linkage remains at the discussion stage.
That makes the coming discussions important—not simply because Mindanao wants a place in Pax Silica, but because the region needs to define what kind of place it wants.
A supplier?
A processing center?
A manufacturing base?
Or merely an extraction zone feeding a technology ecosystem built elsewhere?
The answer should not be determined solely by investors looking for the cheapest source of minerals.
It should be shaped by a national industrial policy that recognizes both the strategic value of Mindanao’s resources and the rights of the people living on top of them.
The real measure of Pax Silica
Pax Silica could give the Philippines an opportunity to break out of its traditional role as an exporter of raw materials.
But for Mindanao, success should not be measured only by how much nickel, copper or other minerals it can supply.
It should be measured by how much value stays in the region—and whether the communities that bear the risks of extraction share meaningfully in that value.
The region has already paid a price for being mineral-rich.
The next phase of development should not simply increase the volume of extraction while leaving the same communities to absorb the environmental and social consequences.
If Pax Silica is truly about building the Philippines’ place in the advanced technology economy, then Mindanao should not be treated merely as the country’s mineral warehouse.
It should become part of the industrial future being built from those minerals.
Otherwise, the country could end up with a paradox at the heart of its high-tech ambitions:
Mindanao has the minerals. Others get the value. Communities get the cost.
The August 24 BOI discussions could be an early opportunity to change that equation.
