An Ernst & Young report, released today, predicts the economic crisis will push global investors to purchase mining assets and mineral resources ranging from $3.08 m to $15.38 m in 2009 as companies snap up acquisition opportunities and take advantage of low commodities prices.
Ernst & Young global mining & metals sector leader, Mike Elliott, told MINING DAILY the trend will transform the profile of the Australian mining industry by boosting the number of global investors, particularly from Asian countries.
“Foreign investments will inject money into Australian operations and allow projects to be sustained for longer,” he said.
Elliott says new investment will also promote the mining sector by providing funds to open new mining regions.
“Foreign capital is vital to stimulate the market,” he said.
“Global companies will provide capital required to stimulate new investments and allow constant renewal of projects.”
Elliott says global investment in Australian assets will also be a good thing for employment prospects.
“As more money is pushed into these mining projects, there is more focus to keep them sustainable, which includes employing more staff to keep them running,” he said.
Elliott says global stimulus packages will also stimulate the market within six to twelve months.
“As prices start to increase again, more traditional buyers will pick up and create more competition. This will, in turn, push up asset values, which will benefit the mining sector,” he said.