AUSTRALIA is no longer the most attractive region in the world for investment, according to the Fraser Institute Annual Survey of Mining Companies 2017.
In considering both mineral potential and policies, Australia dropped to second place, surpassed by Canada.
All Australian jurisdictions experienced a drop in their Policy Perception Index (PPI) scores this year, indicating that despite high rankings in mineral potential, public policy factors are holding Australia back.
Policy factors examined include uncertainty concerning the administration of current regulations, environmental regulations, regulatory duplication, the legal system and taxation regime, uncertainty concerning protected areas and disputed land claims, infrastructure, socioeconomic and community development conditions, trade barriers, political stability, labour regulations, quality of the geological database, security, and labour and skills availability.
Northern Territory, Victoria and Western Australia experienced the largest drop in their policy score – all declining by approximately 10 points. South Australia dropped seven points this year. Queensland fell to 12th place.
Western Australia was again the most attractive jurisdiction in the region, and the fifth most attractive jurisdiction in the world based on the Investment Attractiveness Index.
However, consistent with other Australian jurisdictions, the policy climate in Western Australia is causing investment concern, with its policy ranking decreasing from ninth in 2016 to 17th in 2017. This is said to reflect ‘increasing concern over political stability (+19 points), socioeconomic agreements/community development conditions (+11 points), and the taxation regime (+10 points)’.
“While geologic and economic evaluations are always requirements for exploration, in today’s globally competitive economy where mining companies may be examining properties located on different continents, a region’s policy climate has taken on increased importance in attracting and winning investment” the report said.
“Sound regulatory regimes are an absolute must for policymakers who want to attract increasingly precious commodity investments” said Kenneth Green, senior Director of the Fraser Institute’s energy and natural resources studies.
AMMA’s Director of Industry Services, Tara Diamond, has called for urgent attention from Australia’s policy makers to pursue reforms that would restore Australia’s attractiveness to the top spot globally.
“In the resources and energy industry, the decision on where to invest capital and create employment largely rests on costs versus returns, political and policy stability and the right policies for doing business and employing people”, Ms Diamond said.
“With new and increasingly sophisticated mining and energy markets opening up globally, coupled with the technological advancements and societal trends, Australia’s decision-makers must work harder to improve key determinants of productivity and competitiveness, including fundamental workplace relations reform.”
For further information, please contact AMMA’s policy team at [email protected].
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