The world is experiencing a shortage of the most important base metals (aluminum, copper, lithium, nickel, etc.) used to produce and manufacture a wide range of goods. Inventories are at multiyear lows and the International Monetary Fund’s Base Metals Price Index, which tracks the prices of these base metals, has gone up 21 per cent since November.

Why should you care? Because plans to decarbonize the world’s economy rely on an ample supply of base metals to produce batteries, electric vehicles, solar panels and wind turbines. As such, government policies are critically important in attracting much-needed investment to increase the production of metals and minerals to supply current and future demand.

In this context, the Fraser Institute’s annual mining survey tracks the perceptions of mining investors around the world to determine which jurisdictions are attractive—or unattractive—for investment based on government policies and geological potential. The survey spotlights policies (taxes, duplicative regulations, availability of labour and skills, etc.) that impact investment decisions. The most attractive jurisdictions in the world match their mineral potential with a competitive policy environment and/or overcome a lack of mineral potential with solid policies.

This year, three Canadian provinces—Saskatchewan (ranked 2nd), Quebec (6th) and the Yukon (8th)—are in the top 10 most attractive jurisdictions for mining investment. However, despite the relatively strong performance of some Canadian provinces and territories compared to their international competitors, senior mining executives continue to cite policy uncertainty—particularly around protected areas, disputed land claims and environmental regulations—as major barriers to investment in Canada.

For example, 75 per cent of respondents for British Columbia, Manitoba and Nova Scotia said uncertainty about which areas will be protected and off-limits for mining exploration was a deterrent to invest. And 81 per cent of respondents for the Northwest Territories, 79 per cent for Manitoba and 75 per cent for Nova Scotia cited uncertainty around disputed land claims as a major deterrent for investment.

Even in a top mining province such as Ontario, more than one-third of respondents indicated that uncertainty around environmental regulations dissuaded investment. Executives are clearly identifying policy uncertainty as a key investment barrier in Canada’s mining industry.

In addition to these ongoing policy issues, mining executives are raising alarms about new policy barriers in the areas of labour regulation and labour availability. In fact, in 11 out of the 12 surveyed Canadian jurisdictions, policy perception concerning labour availability deteriorated. And in nine of all surveyed Canadian jurisdictions, policy perception around labour regulations worsened as investors are seemingly more wary of recent labour shortages in the industry (highest job vacancy rate in years) and recent amendments to mining labour codes regarding occupational health safety in Ontario, Alberta and British Columbia.

Overall, cost-effective clear policies are necessary to attract much-needed investment in the mining sector. If Canada wishes to attract the investment required to develop these critical mineral resources—and become a major global supplier of metals and minerals needed for the energy transition—governments should address ongoing and new policy issues. Otherwise, we could cede ground to other countries, many of whom have higher greenhouse gas emissions and lower overall environmental standards than Canada.