The Fraser Institute has named Botswana as a top mining jurisdiction beating other countries according to latest Annual Survey of Mining Companies. The report for 2018 also says Nevada is the most attractive jurisdiction in the world for mining investment, followed by Western Australia (2nd) and the Canadian province of Saskatchewan (3rd).
The survey highlighted that the median score for Africa on policy factors (PPI) increased this year. This was also the case for the region’s median investment attractiveness score. In terms of overall investment attractiveness, as a region, Africa ranks as the second least attractive jurisdiction for investment.
“Botswana is again the highest ranked jurisdiction in Africa on policy, ranking 12th (of 83) in 2018, after ranking 21st (of 91) in 2017,” stated the survey. “Botswana’s increase in its PPI score this year reflects decreased concern over uncertainty concerning protected areas (-24 points), trade barriers (-20 points), and political stability (-18 points),” it added. Namibia is the second most attractive jurisdiction when only policies are considered, ranking 36th (of 83) this year.
Two African countries—the Democratic Republic of Congo (82nd) and Zimbabwe (76th) —ranked in the bottom 10 of the survey rankings this year based on policy. Zimbabwe was also amongst the bottom 10 in the previous six years on the PPI. Ethiopia was the only African jurisdiction in the global bottom 10 based on its overall investment attractiveness.
“The tax regime in Botswana continues to be exemplary when compared to other African jurisdictions and encourages investment in exploration,” said an exploration company, Vice-president. Four other African countries—South Africa, Tanzania, Zambia and Zimbabwe—experienced notable increases in their PPI scores this year. South Africa’s increase of almost 22 points resulted in an increase in the rankings from 81st (of 91) last year to 56th (of 83) this year.
“This year miners expressed decreased concern over uncertainty concerning protected areas (-28 points), the taxation regime (-24 points), and regulatory duplication and inconsistencies (-23 points). Tanzania also experienced an increase of nearly 12 points on its PPI score, resulting in it rising in the global rankings from 78th (of 91) in 2017 to 66th (of 83) in 2018.”
According to Fraser, investors expressed decreased concern over security (-24 points), uncertainty concerning disputed land claims (-21 points), and uncertainty regarding the administration, interpretation, or enforcement of existing regulations (-15 points). Zambia (53rd) saw its PPI score increase this year as well. However, this African country was unable to recover to 2016 levels when it ranked 43rd (of 104). Since last year, respondents expressed decreased concern over Zambia’s political stability (-18 points), infrastructure (-15 points), and legal system (-13 points). Zimbabwe’s score and rank increased this year, moving it up from 89th (of 91) last year to 76th (of 83). Despite this increase, the country is still Africa’s second least attractive jurisdiction based on policy factors.
Mali experienced the largest decline in Africa based on the perceptions miners have of policy. Mali’s decrease of almost 7 points resulted in this country dropping from 46th (of 91) last year to 63rd (of 83) this year. Investors displayed increased concern this year over labour regulations and employment agreements (+54 points), the legal system (+39 points), and availability of labour and skills (+37 points).
This year’s survey of mining executives ranks 83 jurisdictions around the world based on their geologic attractiveness for minerals and metals and the extent that government policies encourage or deter exploration and investment.
“The mining survey—now in its 21st year—is the most comprehensive report card on government policy decisions that either attract or scare away investors from around the world,” said Kenneth Green, resident scholar and chair of the Fraser Institute’s energy and environmental studies and co-author of the report.