Mining investors remain worried about Yukon’s disputed land claims
While Canada generally suffers from an economic slowdown, the Yukon faces a brighter outlook. According to a 2022 Conference Board of Canada report, the westernmost territory is expected to enjoy economic growth of 7.6 per cent in 2022, higher than the 4.3 per cent forecasted for the rest of Canada, largely due to rising mineral production.
The report’s key finding—that the mining industry will drive the Yukon’s economic expansion—coincides with results from the Fraser Institute’s latest mining survey, which shows that the Yukon has great potential in the eyes of mining investors. Specifically, the survey, which tracks the perception of senior executives in the mining industry to determine what jurisdictions are attractive or unattractive to mining investment based on both the policy environment and mineral potential, ranked 84 jurisdictions worldwide and found the Yukon ranked in the global top 10 most-attractive jurisdictions.
This represents an improvement, from 18th place last year in overall attractiveness to 9th this year—again, driven by strong mineral potential and perceived policy improvements.
On policy factors alone, the Yukon went from ranking 39th last year to 23rd this year due largely to enhanced perceptions of the region’s community development conditions, environmental regulations and reduced uncertainty around protected areas (which are off-limits to mining exploration and production). Overall, the Yukon performs well in areas related to physical security, quality of geological database and labour regulations.
Despite its good performance in the overall investment attractiveness, there’s still room for improvement on policy factors.
The top areas of concern are uncertainty concerning disputed land claims and protected areas, and the quality of infrastructure. Indeed, this year 62 per cent of respondents indicated that uncertainty concerning disputed land claims was a deterrent to investment. Similarly, 60 per cent of respondents identified the uncertainty concerning protected areas as a deterrent to investment. Finally, quality of infrastructure is another policy barrier hampering the region’s mining competitiveness with 58 per cent of respondents identifying this factor as a deterrent to mining investment.
Mining and its supportive activities represent more than 9 per cent of the Yukon’s economy and 95 per cent of the territories’ exports. While the world’s demand for minerals continues to increase, the Yukon would benefit from resolving the existing policy issues that impede further investment and development.