Canada needs to stake its claim in mining or risk falling behind
2015-07-27


Pierre Graton

For 72 years, Canada’s Energy and Mines Ministers have come together for an annual conference. This week, they met amidst the backdrop of a stubborn downturn in global demand for many minerals and metals.


More than many sectors in the economy, and more than most people would prefer, global mining has cycles where demand and prices drop, followed by a correction and strengthening.

That’s why it’s important to remember that a downturn is no time to get down on mining. Even in a downturn, mining provides close to 400,000 well-paying, highly skilled jobs. It still accounts for almost 20 percent of Canada’s exports. It fuels local community economies in every part of the country, and keeps the lights on in office buildings in Toronto, Vancouver and Montreal where professionals help sustain Canada’s lead place as the world’s centre in mine finance.

Mining never goes away. As the saying goes, if it’s not grown, it’s mined. Minerals and metals are the building blocks of virtually everything that we use in our homes, at our work and in getting to and from places.

In truth, a downturn is when policymakers need to pay more attention to mining. To make sure Canada is on a sound footing for the moment when commodities rebound, as they always do.

We can’t afford to, and shouldn’t, take Canadian mining success for granted. Mineral investment is highly mobile, and our country is competing with scores of others, who all want to attract mineral exploration and development dollars. 

So what should we do?

Our message to Mines Ministers is a simple one: let’s take the steps we know will give us a head start when commodities boom again.

Mining is Canada’s largest employer of Aboriginal Canadians, with over 300 industry/community agreements signed. Our industry believes in the full and meaningful participation of Aboriginal people in the opportunities generated by mining development. But governments must be consistent and coordinated in carrying out their duty to consult Aboriginal communities, and be clear and reasonable regarding expectations of industry. All the right intentions are in place – we need practical paths forward, now.

Canadians expect a regulatory system designed to protect the environment and encourage economic activity. But several years of reforms have prompted new and unintended inefficiencies. We have questions about whether departments have the resources they need to carry out their responsibilities in a timely way. Some companies find themselves dealing with situations where lead officials for the same permit change repeatedly, leading to costly, unnecessary delays. We are not seeking less regulation, just a more efficient way to get things done.

A big part of the future of Canadian mining is in the north. However, the north lacks the infrastructure – roads, electricity, ports, railways –necessary to get Canadian products to market. Canada needs a strategic collaboration involving industry and governments to get this nation-building infrastructure in place. The right long term thinking means using fiscal tools to facilitate private sector infrastructure investments. We know this can work – we just need to decide that it matters and we should get on with it.

Finally, but maybe most urgently, we need to help out Canada’s junior exploration sector, which is facing its worst financial conditions in many years. Access to capital for junior miners is extremely tight. A new approach like the Cooperative Capital Markets Regulator represents a unique opportunity to give these companies a way to find and work with a broader base of investors, by reducing regulatory burden and compliance costs.

The mining sector is controlling costs and preparing for the next upswing, but good public policy is also critical to Canada’s continued leadership in mining. Federal and provincial ministers have for decades made sure Canada thinks carefully about, and acts wisely to make sure our citizens continue to benefit from the opportunities presented by our vast national resources. There’s no time like the present to renew that history with some bold, and needed actions.


Pierre Gratton is the President and CEO of The Mining Association of Canada.





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