2 March 2012
South Africa moved up 13 places to 54th out of 93 jurisdictions in the latest influential Fraser Institute ranking of the world’s most attractive regions for mining investment.
In the previous survey, South Africa was ranked 67th out of 79 jurisdictions.
The Fraser Institute’s 2011/12 Survey of Mining Companies, released in February, is based on the opinions of mining executives representing 802 mineral exploration and development companies on the investment climate of 93 jurisdictions around the world.
The companies participating in the survey reported exploration spending of US$6.3-billion in 2011 and $4.5-billion in 2010.
‘Reflection of work done by the minister’
Chamber of Mines of South Africa chief executive Bheki Sibiya said the views of mining executives were important in measuring a country’s relative attractiveness as a mining investment destination “as these executives have global perspectives on policy issues affecting mining”.
Sibiya said South Africa’s rise in the rankings was a reflection on the work done by Mineral Resources Minister Susan Shabangu and her department to improve the country’s investment attractiveness.
Finance Minister Pravin Gordhan’s allocation, in his 2012/13 national Budget speech, of increased resources for the development of ports and rail infrastructure, which were critical to the mining industry, would complement the country’s improved policy environment, Sibiya said.
Plenty of room for further improvement
At the same time, Sibiya cautioned that much work still needed to be done in South Africa’s mining sector to address community-related issues, the administration and interpretation of existing regulations, as well as the duplication of statutes regulating the mining industry.
He said the fact that these were outlined in the Fraser Institute survey showed that they were considered as constraints by the investment community.
Sibiya stressed that the mining industry was “ready and willing to work with the government in strategies to reduce unemployment, poverty and inequality”.
Fred McMahon, Fraser Institute vice-president of international policy research and coordinator of the survey, said in a statement accompanying the survey that the key to establishing a positive investment climate was “for governments to have a clear, sensible vision for mining policy and to stick to it.
“By upholding the rule of law, respecting negotiated contracts and property rights, and eliminating risk with regard to tax increases and red tape, nations can attract mining investment and reap the economic and social benefits of new jobs and increased prosperity.”