Kenya is among countries with the worst regulations governing the mining sector, discouraging investments.
A report on the latest annual survey carried out by Canada’s Fraser Institute places the country on the global bottom 10 list alongside Guinea, marking them the worst performing in Africa in the mining attractiveness index.
The index measures how attractive a country’s mining policies are from the point of view of an exploration manager.
“Some general trends seen among those countries rated at the bottom of the survey on policy are big concerns about security, political stability and trade barriers,” reads the report.
The index acts as a report card to the governments on how attractive their policies are in driving both foreign and local investments in their extractive industries.
It assesses the various taxation regimes for mining companies and the quality of infrastructure in place to serve the industry.
PERFORMING BELOW TARGET
The report comes at a time when the government is eyeing additional revenue from the mining sector, which has been performing below target.
The poor performance has been mainly blamed on non-compliance with payment of royalties by mining companies, corruption and lack of timely revisions of payment rates in line with changes in global prices of minerals.
Last year, the Canada-based think tank named Kenya’s mining industry as the worst performing on the continent, drawing criticism from the Ministry of Mining, which argued that the study ignored ongoing reforms in the sector.
Last year’s survey placed the country at position 120 out of 122 countries included in the survey, dropping from position 79 in 2013.
Uganda and Tanzania performed better than Kenya at positions 92 and 56 respectively.
The survey did not include Rwanda and Burundi.