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MCA urges states to do more to attract mining investment

1st March 2017

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – The Minerals Council of Australia (MCA) has urged state and territory governments to “raise their game” to attract mining investment, pointing to the latest data from the Canada-based Fraser Institute that shows Australian states are slipping in terms of investment attractiveness and policy perception.

The two Canadian provinces of Saskatchewan and Minotoba were at the top of the list of attractive jurisdictions for mining investment in the Fraser Institute’s latest Annual Survey of Mining Companies, with Western Australia falling to third place from its previous position in the top spot.

“A richness of mineral reserves, coupled with competitive tax regimes, efficient permitting procedures and certainty surrounding environmental regulations can still attract significant investment – even with slumping commodity prices,” said Fraser Institute energy and natural resource studies senior director and co-author of the survey Kenneth Green.

The rest of the top ten includes the US state of Nevada, Finland, the Canadian province of Quebec, the US state of Arizona, Sweden, the Republic of Ireland, and Queensland in tenth position.

The Fraser Institute survey, which collates views from mining company executives from around the world, shows Australian states are slipping behind major competitors in terms of investment attractiveness and policy perceptions.

“The survey demonstrates that other jurisdictions around the world are increasingly hungry for new investment. Politicians who propose huge new taxes in a cavalier manner will inevitably damage the state and national reputation as an investment destination,” said MCA CEO Brendan Pearson on Wednesday.

While Queensland’s investment attractiveness ranking improved by six spots to tenth, New South Wales dropped to sixty-second, down from thirty-eighth in 2015, while Victoria ranks fifty-seventh and Tasmania fifty-sixth.

South Australia has fallen three places to thirteenth.

“The recent problems with the reliable and cost effective supply of electricity in South Australia, which cost the mining and minerals processing sector A$357-million in lost output, are highlighted by a respondent.

“The push to renewable energy without transitional arrangements has led to a power price crisis that is deterring investment in South Australia,” Pearson said.

New South Wales is also now the lowest ranked Australian jurisdiction in overall mining investment attractiveness and the commentary in the survey points to increasing red tape and bureaucratic approval processes as a cause for the slide.

“With Australia’s minerals industry facing an effective tax rate of 54.3%, it is critical that a phased reduction in the company tax rate is introduced to remain internationally competitive.

“Our energy policy must also be refocused on the imperatives of reliable and affordable energy. Australia has fallen from having the lowest energy costs just over a decade ago to twenty-seventh in the developed world,” Pearson said.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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