AMN - Declining rankings show it’s no time for complacency – comment by Yolanda Torrisi

African countries need to improve their investment attractiveness and prioritise public policy improvements after the annual Fraser Survey showed the mining industry believes nations on the continent have gone backwards.

The world mining industry assessed a shrinking number of jurisdictions in the 2019 survey, as mining sectors shrank across the world and a five-year trend continued towards countries not attracting enough data to be rated.

There were 76 jurisdictions rating a mention in the Annual Survey of Mining Companies released last week, compared to 83 jurisdictions assessed for the 2018 survey released last year. There’s a shrinking number of countries being assessed each year as sectors decline and jurisdictions fail to attract enough data to even be mentioned.

Western Australia now tops the investment attractiveness list while Finland has beaten all with its public policy. Tanzania now has the unfortunate glory of being the world’s least attractive jurisdiction for investment, with a score of 32.82 that places it 76th in the world.

The Investment Attractiveness Index examines perceptions of a jurisdiction’s public policy (40 per cent) and minerals potential (60 per cent) to produce a score out of 100 that is then used to determine a country or jurisdiction’s world ranking.

Not only is Tanzania’s result the worst among the ranked African nations, but it also puts the continent on the map as home to the least attractive jurisdiction. In the last Fraser survey, the Latin American country of Venezuela had the lowest investment attractiveness score.

Finland is the second-highest ranked jurisdiction for investment attractiveness while in Africa, Zambia is number 71, or fifth from bottom and the Democratic Republic of the Congo (69) and Mali (68) are also in the bottom 10 jurisdiction after slipping in the rankings from 2018 but improving their performance compared to Tanzania which was 66 in last year’s survey of 83 jurisdictions. Mali was ranked 50th most attractive in the 2018 survey while the DRC was 67.

Once upon a time, Zambia had been one of Africa’s premier mining jurisdictions, especially for copper. In the 2018 survey it was the 45th most attractive jurisdiction — a huge decline in a year. However, its 2019 result is especially disappointing given in 2014 it was the 25^th most attractive jurisdiction in the world (out of 122 jurisdictions).

Times change and Zambia’s slippage just goes to show how important it is persistent efforts are made to build and sustain the mining industry. Let’s take Zambian and other African slides as a cue to address our lingering issues — before countries further decline and more funding disappears.

As a side note, Guinea is a breath of fresh air in this year’s survey, delivering a number-20 world ranking. It is the most attractive jurisdiction on the continent, coming in higher than South Africa which is the 40th most attractive investment destination worldwide. Botswana is Africa’s number-three jurisdiction (45 worldwide) while Burkina Faso is fourth (51), Namibia fifth (55), Zimbabwe sixth (64), Mali seventh (68) and the DRC eighth (69).

Guinea’s investment score is 76.64, while South Africa has captured a 64.79 score, Botswana 63.39, Burkina Faso 61.19, Namibia 58.22, Zimbabwe 44.81, Mali 39.53 and the DRC 39.20.

As I’ve said over the past few weeks, South Africa needs action to reverse a negative trend while other jurisdictions need to boost certainty on the regulatory and policy front. We must encourage governments to actively address their issues so we can all lift mining on the continent and move things forward.

The Fraser Survey’s Policy Perception Index has Namibia as its top-ranking African jurisdiction, holding a score of 87.22 that places it 14th in the world. Botswana is the second-best African jurisdiction for policy, with an 83.48 score, placing it 22nd worldwide. The eight other African jurisdictions the survey profiles have policy scores less than South Africa’s 59.71 score which puts it in third place on the continent or 56th worldwide.

Let’s encourage change by lobbying governments to improve their policies. Let’s also get leaders on board to enhance our progress. Every bit matters to improving investment attractiveness and moving things forward.

Yolanda Torrisi is Chairperson of The African Mining Network and comments on African mining issues and the growing global interest in the continent. Contact:yolanda@yolandatorrisi.com