Download Investment Inquiry Initiative

Investment Inquiry Initiative
January 8, 9, 10 from 1 to 4pm
Loussac Library Assembly Chambers
Alaska’s options and opportunities—
The Investment Inquiry Initiative will explore where Alaska fits into global industry decision-making
based on the Fraser Institute’s Global Petroleum Study’s 18 key questions.
Dr. Gerry Angevine, the study’s author and senior economist at the Fraser Institute's Global Resource
Centre, will make introductory comments and serve as a key resource throughout. Each session will
feature three guest speakers who will “testify” before the Inquiry group. Subject matter experts and
industry and civic leaders will have the opportunity to respond to Global Petroleum Study’s factors.
Following the testimony, speakers will respond to follow-up questions from the panel. The final
component of each session will be an open, facilitated discussion amongst the participants as they
weigh the information presented against the results of the study and Alaska’s current position. Quick
post-session debrief interviews will give participants the opportunity to comment on key take-aways
and lessons-learned.
January 8 - Commercial Environment
The first session will concentrate on the categories jurisdictions on six factors that affect after-tax cash
flow and the cost of undertaking petroleum exploration and development activities:
 fiscal terms
 taxation regime
 trade barriers
 quality of infrastructure
 labor availability
 corruption
Guest Testimonial from:
1)
2)
3)
January 9 - Regulatory Climate and Geopolitical Risk
The second session will address regulation and political stability. Regulation encompasses:
 the cost of regulatory compliance
 uncertainty regarding the administration, interpretation, and enforcement of regulations
 uncertainty concerning the basis for and/or anticipated changes in environmental regulations
 labor regulations, employment agreements, and local hiring requirements
 regulatory duplication and inconsistencies
 legal system fairness and transparency
A relatively high value indicates that regulations, requirements, and agreements in a jurisdiction
constitute a substantial barrier to investment.
Geopolitical risk inlcudes political stability and security. These factors are considered to be more difficult
to overcome than either regulatory or commercial barriers because a change in the political landscape is
usually required for significant progress to be achieved.
Guest Testimonial from:
1)
2)
3)
January 10 - Best practices / Keys to Competitiveness
The best practices session pertains to the potential impact of the adoption of best practices on the
attractiveness for investment.
Keys to competitiveness include:
 decisions depend on the network of resources available—the business ‘ecosystem’ matters
 a region’s leaders can do much to enhance competitiveness without await federal action
 there is ample room for better practices within businesses’ control.
Guest Testimonial from:
1)
2)
3)
COMPETITIVENESS INFLUENCE FACTORS
Global Petroleum Study, Fraser Institute
The factors were designed to capture the opinions of managers and executives regarding the level of
investment barriers in jurisdictions with which their companies were familiar. Respondents indicated
how each of the 18 factors listed below influence company decisions to invest in various jurisdictions.
1. Fiscal terms—government requirements pertaining to royalty payments, production shares, and
licensing fees.
2. Taxation regime—the tax burden (other than for oil production), including personal, corporate,
payroll, and capital taxes, and complexity of tax compliance.
3. Uncertaintyconcerningthebasisforand/oranticipatedchangestoenvironmental regulations.
4. Uncertainty regarding the administration, interpretation, and enforcement of existing regulations and
concern with the frequency of changes to regulations.
5. Cost of regulatory compliance—re: filing permit applications, participating in hearings, etc.
6. Uncertainty over what areas can be protected as wilderness or parks, marine life preserves, or
archeological sites.
7. Socio-economic agreement/community development conditions—includes local purchasing,
processing requirements, or supplying local infrastructure such as schools and hospitals.
8. Trade barriers—tariff and non-tariff barriers to trade and restrictions on profit repatriation.
9. Labor regulations, employments agreements, labor militancy/work disruptions, and local hiring
requirements.
10. Quality of infrastructure—includes access to roads, power availability, etc.
11. Quality of geological database—includes quality, detail, and ease of access to geological information.
12. Labor availability and skills—the supply and quality of labor, and the mobility that workers have to
relocate.
13. Disputed land claims—the uncertainty of unresolved claims made by aboriginals, other groups, or
individuals.
14. Political stability.
15. Security—the physical safety of personnel and assets.
16. Regulatory duplication and inconsistencies (includes federal/provincial, federal/state, interdepartmental overlap, etc.)
17. Legal system—legal processes that are fair, transparent, non-corrupt, efficiently administered, etc.
18. Corruption of government officials—bribery, extortion, etc. increasing the cost and reducing the
likelihood of obtaining licenses and approvals.
U.S. Competitiveness Project, Harvard Business School
The project identified three keys to competitiveness: 1) decisions depend on the network of resources
available—the business ‘ecosystem’ matters 2) a region’s leaders can do much to enhance
competitiveness without await federal action; 3) there is ample room for better practices within
businesses’ control.