The institute's annual Survey of Mining Companies indicates India, Indonesia, Mongolia and the Philippines are among the bottom 10.

Regarding Indonesia, one exploration company manager surveyed said the country offered no security of tenure or transparency, despite its incredible exploration potential.

Survey results are based on the Fraser Institute's Policy Potential Index, a composite measurement of the effects of government mining policies on mineral exploration and development that include environmental regulations, taxation, infrastructure, political stability, uncertainty over native land claims, labour issues as well as geological attractiveness and the interpretation of existing regulations.

As well as the Asian mining countries, others in the bottom 10 included Zimbabwe, Ecuador, Bolivia and Venezuela with Honduras rated the worst.

The institute's director of trade and globalization studies, and survey coordinator, Fred McMahon says: "Mining is a fully international business and the results reinforce the idea that jurisdictions must be prepared to compete on an international basis to attract mining investment."

The survey revealed that the most attractive jurisdictions for mining investment are the Canadian province of Quebec, the US state of Nevada and Finland. Others in the top 10 include Alberta, Manitoba, Chile, Utah, Wyoming, Ireland and Sweden.

"Quebec has always been viewed in a good light by the mining industry, primarily due to its favourable geology," says Fred McMahon, "but Quebec's government also provides a favourable policy environment to go along with strong mineral potential. Mining companies feel Quebec's stable policies provide them with the certainty that reduces risk for long-term projects.

"Year after year, the survey bears out that above all, mineral exploration companies value stability and certainty when it comes to government policy."

This year's survey represents the opinions of 372 mining executives and managers worldwide on the policy and mineral endowment of 68 jurisdictions on all continents except Antarctica.

Australia, Canada and the United States are divided into their states or provinces. Companies participating in the survey reported exploration spending of $US1.48 billion in 2007 - almost 15% of total global exploration of $9.99 billion for that year.

Australian states have gone down in ranking while South Australia, Queensland and Tasmania tumbled out of their previous year's top 10 rankings. This year, South Australia ranked 15, Tasmania 20, Northern Territory 21, Western Australia 25, New South Wales 27, Victoria 28, and Queensland was last, at 29.

One exploration company staffer said New South Wales suffered from uncertainty over environmental requirements for exploration as the authorities go through changes. "In this limbo period, we have been given conflicting advice which has hindered our exploration efforts."

Another mining executive said Australia suffered from native title problems, bureaucratic regulatory slowness, lack of available labor, cost blow outs and timeframe issues. He said development was being hindered through narrow approach to environmental hurdles.