EDITORIAL PAGE (March 30, 1992)

When mineral explorationists gather in Toronto this week for the Prospectors and Developers Association of Canada’s annual convention, they’re not going to hear too much about Canada. The buzzword is going to be “international,” a nice way of saying that the best opportunities can be found elsewhere.

That is an understandable response. Canada isn’t too sure if it wants to back its mining industry while other countries suffer no such uncertainty. Countries such as Mexico and Chile, eager to attract overseas investors, have relaxed regulations on foreign ownership, taxation, repatriation of funds and land access. They want to get the mining industry back on its feet. Canadian companies have responded. Our latest tally shows more than 75 Canadian companies active in Mexico alone as more decide to go where they’re welcomed.

Meanwhile, exploration in Canada has declined for five straight years. Ore reserves, too, have fallen for all metals except gold, which has barely remained flat.

Now in its 60th year, the PDAC features talks on international exploration and project financing as well as opportunities in southeast Asia, Russia, Uzbekistan, Kazakhstan and sub-Saharan Africa.

It’s not for lack of geological potential, or for the technical ability to find ore deposits in Canada. It is because of the country’s political confusion and uncertainty about mining’s role in our economy and the resulting lack of investor confidence.

The helter-skelter changes to environmental regulations with overlapping and sometimes contradicting provincial and federal jurisdictions; the inability to know whether a company will be allowed to mine a mineral deposit after spending time and money on exploration; the high cost of mine-site reclamation and uncertainty about liability for past mining activities. Add to that the country’s overhanging deficit that implies higher taxes down the line and a chronic inability to reach a constitutional settlement to keep the country together, and it’s not hard to understand why investors look more favorably on other countries.

The cost of dealing with this confusion and the time delays that are encountered make it difficult to stay competitive. Our costs per pound of copper produced has risen to US80 cents from US57 cents between 1987 and 1990, making us the fifth most expensive copper producer on a per-unit basis. The U.S., in the same period, moved from being the fifth most expensive to being the lowest-cost producer in the world.

Mining has played a key role in developing the Canadian way of life to the point where the United Nations places us second in quality of life and we rank second among Organization for Economic Cooperation and Development countries in gross domestic product per capita.

If we want to maintain what we have achieved, mining must continue to play an active part. We need the political will to allow our currency to find its own level, secure an open trading environment through GATT and a North American free trade agreement, settle our constitutional bickering, harmonize our interprovincial trade regulations, standardize reasonable environmental regulations, assure explorationists of land access and support development of infrastructure to frontier areas.

With that groundwork in place, there’s no doubt that investment in mining would revive .