Fraser Institute

The Fraser Institute is the top think tank in Canada and this year was ranked among the top 20 think tanks worldwide, in the Global Go-To Think Tanks Index published by the University of Pennsylvania.

According to the Fraser Institute:

"Our mission is to improve the quality of life for Canadians, their families, and future generations by studying, measuring, and broadly communicating the effects of government policies, entrepreneurship, and choice on their well-being. Headquartered in Vancouver, Canada, the Fraser Institute has regional offices in Calgary, Toronto and Montreal. We produce research about government actions in areas that deeply affect Canadians’ quality of life such as taxation, health care, aboriginal issues, education, economic freedom, energy, natural resources and the environment. Measurement is the foundation for all our work. Careful, accurate, rigorous measurement.

"If it matters, measure it" is a slogan you will see around our office. Things that are measured can be talked about. Things that are talked about in the public arena eventually become part of the climate of opinion. That is how measurement can change the climate of opinion.Sometimes our research recommends public policy solutions that some people feel are controversial. We work to ensure that people become more knowledgeable about the outcomes of various public policies and can then make more informed decisions. Our research is peer-reviewed and overseen by an Editorial Advisory Board of leading international scholars. The Fraser Institute promotes transparency in research – in other words, our methodology is open and clearly explained, and others can replicate our conclusions. In addition, the source of our data is always provided. Fraser Institute research is independently conducted."

It is the natural resource branche I am interested in. The Fraser Institute publishes an annual report on the mining industry, called the Fraser Institute Survey of Mining Companies. In this report the institute presents the degree of mining friendly policies around the world among other things, and these mining friendly policies are composed of many factors like taxes, uncertainty concerning regulations, permitting, legal system, political stability, security, work disruptions, etc. This all results in a score and a corresponding ranking of jurisdictions, and the score on mining friendly policies is very important to estimate risks for companies working in relevant jurisdictions, as it can have a huge influence on mining projects. You can find this ranking of jurisdictions in a spreadsheet via Data > Fraser Survey.

A household example in mining of jurisdictional risk is the socalled "African Discount", but there is also an "Arctic discount". The Fraser Institute introduced the Investment Attractiveness Index this year as the most important index, and the Policy Perception Index as second, but make no mistake: the mining community only looks at the Policy Perception Index, as every mining company makes the decision beforehand about the project or claims it buys for a qualifying transaction or IPO. Investors can't say anything useful on it. Besides that, a geological prospective area can generate very disappointing drill results, and vice versa.

The original, last report can be found here, and this is the original announcement by the Fraser Institute:

Fraser Institute Annual Survey of Mining Companies: 2014

Published on February 24, 2015

Since 1997, the Fraser Institute has conducted an annual survey of mining and exploration companies to assess how mineral endowments and public policy factors such as taxation and regulation affect exploration investment. Survey results now represent the opinions of executives and exploration managers in mining and mining consulting companies operating around the world. The survey includes data on 122 jurisdictions worldwide, on every continent except Antarctica, including sub-national jurisdictions in Canada, Australia, the United States, and Argentina. Included in this year’s report for the first time are: Solomon Islands in Oceania; Central African Republic, Egypt, Lesotho, Mauritania, Morocco, South Sudan, Sudan, and Uganda in Africa; Cambodia in Asia; and Hungary in Europe.

The most attractive jurisdiction in the world for mining investment this year is Finland. The other top 10 ranked jurisdictions are Saskatchewan, Nevada, Manitoba, Western Australia, Quebec, Wyoming, Newfoundland & Labrador, Yukon, and Alaska. Finland displaces Western Australia, which dropped to 5th overall. Saskatchewan moved up 5 spots to rank as the second most attractive jurisdiction in the world for investment. Manitoba moved into the top 10 this year, after ranking 13th last year. Greenland dropped out of the top 10 this year, moving down to 41st along with Sweden, which moved down to 12th.

Meanwhile, Malaysia ranks as the least attractive jurisdiction in the world for investment. This is a significant drop for Malaysia which ranked 70th (of 112) in 2013. Also in the bottom 10 (beginning with the worst) are Hungary, Kenya, Honduras, Solomon Islands, Egypt, Guatemala, Bulgaria, Nigeria, and Sudan.Many jurisdictions have considerable room for improvement. Papua New Guinea is the jurisdiction with the most room for improvement. Closely following it are Brazil, Argentina—Santa Cruz, Mongolia, and Indonesia. British Columbia is the Canadian province with the most room for improvement.

Authors: Taylor Jackson Policy Analyst, Fraser Institute Kenneth P. Green Senior Director of Natural Resource Studies, Fraser Institute