An airborne geophysical survey flight passes over a surface operation in northern Sweden—one of the three Scandinavian
countries that rank highly among the world’s most attractive destinations for mining investment, according to a recent
survey. Finland ranked first in the study, followed by Sweden in second place and Norway in 10th.
(Photo courtesy of Dragon Mining)

Kenneth Green, Fraser Institute sen-ior director of energy and natural resources and director of the Survey of Mining Companies: 2012/2013ob-served, “This is the fourth consecutive year that Finland and Sweden have ranked among the global top 10 for mining investment. The confidence miners have shown in Finland and Sweden proves that it’s possible to enact sound environmental protec-tions and still maintain a successful mining industry.”

The Canadian provinces of Alberta and New Brunswick placed third and fourth overall. Alberta ranked first worldwide in 2011, while New Bruns-wick ranked first in 2012.

Wyoming is the top-ranked U.S. state at fifth overall, down from fourth last year, followed by Nevada in seventh place, up from eighth. Rounding out the top 10 are Ireland (sixth), Canada’s Yukon Territory (eighth), Utah (ninth) and Norway (10^th ).

Chile, which was once the only juris-diction outside North America to con-sistently rank among the top 10, con-tinued its precipitous decline in the global rankings, falling to 23^rd this year from 18^th in 2012 and eighth in 2011.

Ranking as the bottom 10 mining investment destinations, starting at the bottom, are Indonesia, Vietnam, Venez-uela, Democratic Republic of Congo (DRC), Kyrgyzstan, Zimbabwe, Bolivia, Guatemala, Philippines and Greece.

“To compete for investment on the global mining stage, jurisdictions need not only stellar resource potential but also a stable, certain, straightforward mining policy framework,” Green said. “Reduce red tape, minimize risk with regard to policy changes and tax increas-es, respect negotiated contracts: that’s how you woo the global mining sector.”

The Fraser report also notes that miners are pessimistic about short-term commodity prices, reporting that they expect nearly level or reduced prices for silver, copper, diamonds, coal, zinc, nickel, potash and platinum, with only gold expected to increase significantly in value. Long-term, the survey respon-dents are more optimistic, with 48% expecting prices to rise by up to 15%, 19% expecting prices to rise by 15% to 30%, and 17% expecting stable prices over the next 10 years.

Miners’ investment intentions re-flect a cautious outlook—46% of the survey respondents said they plan to increase their exploration budgets in 2013, down from 68% in 2012.

Finally, respondents were asked about their agreement with the state-ment: “Many in the mining industry believe the industry now has great diffi-culty raising funds compared to two years ago.” Of those who responded, 60% agreed strongly with this state-ment, 31% agreed somewhat, and only 9% disagreed somewhat or strongly. Of those who agreed with the statement, nearly 80% believed the difficulty in raising funds was due to investors being worried about the state of the world economy, 52% believed investors are risk averse and see mining as risky, and 36% thought investors are worried that costs in mining are rising.

The Fraser Institute’s Survey of Mining Companies: 2012/2013 is based on the opinions of mining execu-tives representing 742 companies. These companies reported exploration spending of $6.2 billion in 2012 and $5.4 billion in 2011. The complete survey is available as a free PDF download at www.fraserinstitute.org.