The confluence of soaring gold and silver prices, coupled with a surge in resource nationalism across some African nations, is compelling global mining companies to re-evaluate their operational landscapes, increasingly favoring North American jurisdictions for their perceived stability. This strategic pivot, according to Maria Smirnova, Chief Investment Officer at Sprott Asset Management, is driven by a desire for predictable regulatory environments and a hedge against the growing geopolitical uncertainties impacting resource-rich regions.

The landscape in West Africa’s Sahel region has seen significant shifts in recent years. Military governments, asserting greater control following periods of instability and the fight against Islamic terrorism, have intensified efforts to reallocate national wealth. This has often translated into renegotiated agreements with established Western mining companies, aimed at securing a larger share of revenue and greater national oversight for the benefit of their populations, many of whom reside in some of the world’s poorest communities.

Smirnova highlighted this trend in a recent interview with The Northern Miner, stating, "It seems like every month we see an announcement of a government in Africa wanting more royalties, renegotiating tax codes or mining codes. That’s why there has been more demand for stable jurisdictions such as Canada and the US." This sentiment is not merely theoretical; it is manifesting in tangible investment decisions and portfolio adjustments by major players in the global mining sector.

A particularly stark illustration of this dynamic occurred in Mali, where a prolonged dispute between the government and Barrick Mining (TSX: ABX; NYSE: B) culminated in a significant standoff. The Malian military government seized approximately three tonnes of gold from Barrick’s Loulo-Gounkoto complex, citing alleged unpaid taxes. This action led Barrick to temporarily suspend operations at the mine, sending ripples of concern through the investment community and underscoring the heightened geopolitical risks associated with operating in certain African territories. The dispute, which unfolded over an extended period, represented a critical test of investor confidence and the viability of long-term resource extraction agreements in the region.

A Flight to Stability: Canada and the US Emerge as Preferred Destinations

Maria Smirnova, a seasoned veteran with two decades of experience at the Toronto-based Sprott Asset Management, oversees several prominent funds, including the Sprott Silver Strategy portfolio and various Sprott Active ETFs focused on precious metals and miners. She confirmed that some of her managed portfolios have recently reduced their exposure to companies with significant African assets, a direct consequence of this observed trend towards greater geographical diversification and risk mitigation.

The acquisition of Probe Gold by Mexican precious metals giant Fresnillo (LSE: FRES) for C$780 million (approximately $556 million) in cash in October serves as a compelling example of this renewed interest in Canadian mining assets. Smirnova pointed to this transaction as evidence of the growing appetite for stable, well-regulated mining environments. "Canada has been in high demand," she remarked. "There are deals that indicate that movement. You saw Fresnillo came and bought a Canadian asset." This move by Fresnillo, a company with a substantial operational footprint in Mexico, signals a strategic diversification beyond its traditional base.

Mexico’s Complex Landscape: Promise and Peril

While Canada is experiencing a surge in interest, Sprott also maintains a positive outlook on Mexico’s mining sector, despite recent security concerns. Smirnova acknowledged the unfortunate January kidnapping of 10 employees from Vizsla Silver (TSX; NYSE: VZLA) in Sinaloa, stating, "Of course [the kidnappings are] a very unfortunate situation. It gives you pause for thought." However, she emphasized that the long-term outlook for mining investment in Mexico remains promising, particularly with the current administration’s efforts to streamline permitting processes. "Overall we think the granting of the permits will be more important longer term. By and large, we think Mexico is heading in the right direction," Smirnova added, suggesting that policy reforms aimed at reducing bureaucratic hurdles could significantly boost the sector.

The Dual Engines of Wealth Preservation and Investment Demand

The heightened global interest in gold and silver over the past two years can be attributed to a confluence of factors, including persistent inflation concerns and a perceived weakening of the U.S. dollar as a global reserve currency due to fiscal uncertainties. This environment has driven precious metal prices to record highs. Gold experienced a substantial surge of approximately 65% in 2025, while silver more than doubled, with both metals setting new benchmarks in the early months of the current year.

Smirnova views these metals as crucial instruments for wealth preservation against the backdrop of potential fiat currency debasement. "We view gold and silver as tools to protect your wealth to protect against fiat [government] currency debasement," she explained. Her rationale is rooted in the fundamental scarcity of precious metals compared to the ease with which governments can print money. "Fiat currency is easy to print but metals are hard to find and produce. We just aren’t finding enough of any of this stuff. That’s why we’re getting these imbalances."

Silver’s Robust Fundamentals Point to Sustained Demand

The supply and demand dynamics for silver, in particular, suggest that its upward price trajectory is unlikely to reverse in the near future. According to the Silver Institute’s 2026 forecast report, published on February 10th, silver is projected to experience a deficit for the sixth consecutive year. This persistent imbalance is expected to be driven by robust investment demand that is more than sufficient to offset a projected decline in industrial consumption.

Industrial fabrication of silver is anticipated to decrease by 2%, reaching a four-year low of 650 million ounces. This decline is primarily attributed to efforts within the solar sector to reduce silver usage, even as solar installations continue to expand globally. This "thrifting" indicates an increased efficiency in silver utilization within this critical growth industry.

Investment Demand as a Catalyst for Silver Prices

While demand for jewelry and silverware is forecast to drop by 9% and 17% respectively, a projected 20% surge in physical investment is expected to counterbalance these decreases. The Silver Institute predicts that investment demand will reach a three-year high of 227 million ounces, underscoring the growing appeal of silver as a tangible asset.

"Silver has a good fundamental picture," Smirnova asserted. "I don’t see it crashing to $40." As of Friday morning, silver was trading at approximately $81.25 per ounce, marking a significant 141% increase over the past 12 months. This remarkable price appreciation is not a sudden phenomenon, Smirnova clarified. "This price rise has been building for a long time. The demand-supply picture for silver has been very strong for five to seven years," she noted.

She elaborated on the key drivers: "Supply has been stagnant, demand has been growing, particularly electronic and solar demand. Now that investment demand has kicked in, that’s what’s driven up the price. Investment demand has always been seen as a swing factor. It’s lit the price on fire." This surge in investment demand, often characterized by its volatility, has become a primary catalyst for silver’s recent impressive performance.

A Broader Commodity Supercycle?

Beyond gold and silver, Smirnova anticipates that other metals will also benefit from sustained demand in the coming years. She points to a broader trend where a range of essential commodities are experiencing upward price pressure. "Why are copper, uranium, gold, silver, other metals, even lithium, going up? Why is everything going up all of a sudden? The world has weaponized metals and mining," she stated.

This "weaponization" refers to the increasing recognition of the strategic importance of these raw materials in a world focused on technological advancement and energy transition. "The world has realized that we need all these things to build stuff. We need these things to electrify. Electrification and power generation are big themes and they’re not going away," Smirnova concluded. This fundamental shift in global priorities, driving demand for materials essential for renewable energy infrastructure and technological innovation, underpins the bullish outlook for a wide array of commodities. The implications for mining companies are significant, with potential for increased profitability and strategic investment opportunities, provided they can navigate the evolving geopolitical and regulatory landscapes effectively.