AUSTRALIA remains the second most attractive region in the world for investment, according to the Fraser Institute Annual Survey of Mining Companies 2018.

It follows Australia relinquishing top spot to Canada in 2017 when considering both mineral potential and policies.

Western Australia was once again rated as the most attractive jurisdiction in the region, rocketing up from last year’s fifth ranking to be the second most attractive jurisdiction in the world this year based on its Investment Attractiveness score.

The ranking is based on a combination of Best Practices Mineral Potential index, which rates regions based on their geologic attractiveness, and the Policy Perception Index (PPI), a composite index that measures the effects of government policy on attitudes towards exploration investment.

Nevada (USA) continued its reign as the top jurisdiction in the world.

In terms of PPI, two Australian jurisdictions – Victoria and Western Australia – saw their scores improve by more than 10 points this year.

Victoria’s score and rank improved from 52nd (of 91) in 2017 to 43rd (of 83) in 2018 with respondents expressing decreased concern over Victoria’s political stability (-17 points), uncertainty regarding the administration, interpretation, or enforcement of existing regulations (-13 points), and the taxation regime (-11 points).

Western Australia saw a significant improvement in its score and rank, moving up to 5th (of 83) from 17th (of 91) last year, as fewer respondents rated the taxation regime (-23 points), political stability (-15 points), and uncertainty concerning environmental regulations (-12 points) as deterrents to investment.

Policy factors examined include uncertainty concerning the administration of current regulations, environmental regulations, regulatory duplication, the legal system and taxation regime, uncertainty concerning protected areas and disputed land claims, infrastructure, socioeconomic and community development conditions, trade barriers, political stability, labor regulations, quality of the geological database, security, and labor and skills availability.

In 2017, all Australian jurisdictions experienced a drop in their PPI scores, indicating that despite high rankings in mineral potential, public policy factors are holding Australia back.

The PPI score for New South Wales increased by over 8 points since last year, and the state’s rank improved 53rd (out of 91) in 2017 to 47th (out of 83) in 2018. This year miners expressed decreased concern over trade barriers (-10 points) and increased concern over the legal system (+14 points).

Despite this state’s increase in the rankings, New South Wales is Australia’s lowest ranked jurisdiction when considering policy factors alone

This year’s survey of mining executives ranks 83 jurisdictions around the world based on their geologic attractiveness for minerals and metals and the extent that government policies encourage or deter exploration and investment.

“The evidence is clear—mineral deposits alone are not enough to attract precious commodity investment dollars,” said Ashley Stedman, a senior policy analyst at the Fraser Institute and study co-author.

“A sound regulatory regime coupled with competitive fiscal policies is key to making a jurisdiction attractive in the eyes of mining investors.”