PHL may miss green shift gains sans nickel reform

By Erika Mae P. Sinaking

THE Philippines risks missing out on the full economic and social gains from the global green transition if it continues to rely on raw nickel extraction without improving job quality, safety and domestic value creation, according to a research brief released this week by the International Labour Organization (ILO).

In its study on decent work in renewable energy and critical mineral supply chains across Asia and the Pacific, the ILO said the Philippines could remain trapped in a low-value, extractive model, even as global demand for critical minerals accelerates, unless targeted reforms are introduced.

“Unless deliberate policies are put in place to uphold decent work and increase value addition, participation in supply chains, including those critical for the energy transition, can present the risk of perpetuating economic models based on extracting raw materials with limited value addition, rather than creating pathways for structural transformation and upgrading,” the ILO said.

Nickel is a vital part of the green energy transition and is a critical component for many renewable energy technologies including battery production.

The Philippines is the world’s second-biggest nickel producer after Indonesia and, together with its neighbor, supplies more than 75% of global demand for the mineral, which is vital for electric vehicles, batteries and renewable energy systems.

Unlike Indonesia, which has pursued aggressive domestic processing policies, the Philippine nickel industry remains largely concentrated on raw ore extraction, the ILO said.

Sector-wide data suggest mining wages are slightly higher than those in comparable industries. However, the ILO’s field research on Philippine nickel supply chains points to persistent gaps in working conditions, said Julius H. Cainglet, vice-president of the Federation of Free Workers.

About 70% of mining jobs are manual and extraction-focused, according to the brief. Workers interviewed cited delayed or withheld wages, mandatory deductions and the need to buy their own protective equipment.

Occupational risks, including exposure to nickel dust and unsafe transport routes, were also raised by workers and surrounding communities.

Union representation remains limited in nickel mining. Where unions exist, workers questioned their independence and effectiveness, particularly for subcontracted workers, who make up most of the workforce. In several areas, no union activity was reported.

“The Philippines continues to open its doors to multinational corporations that extract nickel, copper and other critical and transition minerals for processing outside the country,” Mr. Cainglet told BusinessWorld in a Facebook Messenger chat.

This leaves the country with minimal economic returns while communities bear the long-term environmental and social costs, he pointed out.

He said labor standards are unevenly applied, with stronger protections for regular, unionized workers and weaker safeguards for agency and seasonal staff. “In many enterprises, these precarious workers outnumber regular workers,” he added.

Mr. Cainglet questioned whether mining could meaningfully support a green transition without a coherent industrial policy. “Mining will never be green,” he said, adding that the absence of a clear strategy limits the country’s ability to guide how resources are extracted and processed.

He also criticized the government’s focus on “better jobs” rather than “decent work.” “A job may be better but might still fall below standards, he said, stressing that decent work requires respect for labor rights, social protection and dialogue.

The Philippine Nickel Industry Association (PNIA) said the sector is not focused solely on raw exports and already has processing facilities, including refineries and high-pressure acid leaching plants. Further downstream investment, however, is constrained by market conditions.

“Putting additional plant facilities are still not economically viable at the moment because of the low London Metal Exchange nickel prices and higher production costs compared with Indonesia and China,” PNIA President Dante R. Bravo said in a text message.

He said the industry complies with labor laws and has a strong safety record. “We are one of the safest nickel mining sectors in the world,” he said, adding that there are no known child labor or major human rights violations.

He added that the green transition could still bring improved opportunities if processing investments become viable, leading to workforce upskilling and technology transfer. But preparation is needed, including skill development, lower power costs, streamlined permits and clearer policy direction.

With global demand for critical minerals projected to triple by 2030 and quadruple by 2040, the ILO said the Philippines faces a clear choice: remain a raw ore exporter with persistent labor gaps, or use the green transition to support industrial upgrading, formal employment and better-quality jobs.