Botswana tops in Africa for mining...again

MBONGENI MGUNI
Staff Writer | Monday August 16, 2010 00:00

Released last Wednesday, the Survey captures the views of 429 mining executives operating in 51 jurisdictions assessed by Fraser Institute researchers between June 1 and 30, 2010.

The researchers ranked jurisdictions - which include countries and geographic distinctions within countries - according to the Survey participants' responses to 11 policy areas, which collectively determine the attractiveness of setting up and operating mining ventures in the jurisdictions.

The Mid-Year Update Survey ranked Botswana first in Africa and eighth in the world, a remarkable improvement from position 21 worldwide, which the 2009/10 Survey ranked Botswana.  Worldwide, Botswana was ranked behind Chile, Finland and several Canadian provinces, which topped the Survey. Botswana ranked ahead of developed jurisdictions such as all American states, all Australian states, New Zealand, Argentina, Brazil and others.  After Botswana, Ghana, Tanzania, Namibia and South Africa follow for Africa, according to the Survey. Fraser Institute researchers noted that the Mid-Year Update gauged how respondents reacted to the various measures introduced by jurisdictions in response to the recovery in the mining industry, following a global recession-induced collapse in 2009.  Thus, the Survey indicates that respondents approve of the various measures the Government of Botswana has introduced to support the recovering mining industry in 2010. According to the Survey, Botswana ranked highly in policy areas such as certainty concerning administration, interpretation and enforcement of existing regulation, environmental regulations, taxation, land claims, labour regulations/employment agreements, attitudes towards the mining industry and others.

Respondents were highly positive about Botswana with an exploration company vice president commenting: 'Access to reliable power in South Africa will present problems.  Africa, having some of the world's most significant undeveloped resources, has one of the most attractive jurisdictions with respect to exploration and development - Botswana - and one of the worst - DRC.'

In other jurisdictions, the Survey noted that several areas under assessment made negative regulatory and taxation changes in response to the general recovery in 2010, 'making mining more difficult and costly.' In Quebec, a Canadian state, mining taxes were increased without consultation, while taxation increases were proposed in Chile and Australia, the latter being the controversial super-profits tax.

As a consequence, respondents in 41 out of the 51 jurisdictions examined judged that attitudes towards mining had become more hostile.

The Fraser Institute, an independent Canadian research organisation, has conducted the annual survey since 1997 to assess how mineral endowments and public policy factors such as taxation and regulation affect exploration investment.