THE year 2017 under the administration of President John Magufuli has been described as a turning point for the country's mining sector which has seen Tanzanians today earn their fair share of mineral resources.
The fifth phase government's determination to transform the mining sector has led to various steps that have been taken, including banning gold and copper concentrates exports, the formation of special presidential committees and negotiation teams to ensure the country benefits from its natural resources.
During this time the
Among others, the laws have increased the royalty rate on gold from 4-6 per cent and have allowed the government to own a 16-per cent share of mining companies' stock without compensation.
Dissolving the 11th sitting of
"The most significant change is the endorsement of the Natural Wealth and Resources (Permanent Sovereignty) Act, 2017, including minerals," President Magufuli said.
The law requires Parliamentary approval for future investor-state agreements, which must "fully secure" the interests of Tanzanians and restrict investors from exporting raw minerals, repatriating funds and accessing an international dispute resolution mechanism.
He said the law had enabled Tanzanians for the first time to own their resources through legal powers.
"It has also facilitated the establishment of
President Magufuli further said changes in the mining laws had also facilitated the payment of
Tabling the budget estimates for 2020/21 for the
"Amendments to the mining laws have enabled Tanzanians to benefit from their national resources," he said.
The changes began early March in 2017 after President Magufuli banned the export of gold and copper concentrates, following his suspicion of the declared value of mineral sand.
The ban on the transportation of mineral sand overseas resulted in the formation of the first probe team to investigate the amount of minerals present in exported sand and its value. The eight-member team led by Prof Abdulkarim Mruma comprised experts in geology, chemicals and scientific analysts.
A few days later, President Magufuli formed the second probe committee led by Prof
The first committee revealed how
According to a report, the amount of gold per tonne found in the mineral sand was between 671 - 2,775g, translating to between 7.8 tonnes to 13.16 tonnes for all 277 containers which were detained at the Dar es
"If we take 23.1 tonnes as the weight of the container as opposed to the standard 20 tonnes, you find that there are 15.5 tonnes of gold in all 277 containers, which translates into two lorries and one pickup truck loads of gold," said President Magufuli while receiving the report.
The committee recommended the government to reinforce the ban on mineral sand exports until the right royalties were paid to the country and ensure smelters were constructed in
It also proposed that disciplinary action should be taken against officials in the
The second report presented to the Head of State on the economic impact of mineral sand revealed between 44,000 and 61,000 containers of gold and copper concentrates had been exported between 1998 and
It estimated losses in government revenue running into trillions of shillings over the two decades-through the under-declaration of both export volume and value of gold and copper concentrates. It revealed how
The report said the amount of unpaid taxes between 1998 and
The two reports necessitated the amendment of the country's mining laws which increased government control of the mining sector.
President Magufuli, however, directed
The development led to the formation of a negotiation team led by then Minister for Constitutional and Legal Affairs, Prof Palamagamba Kabudi, who started talks with
The negotiations between the two parties were finally concluded in October last year 2019 after
The parties also agreed Barrick to own 84 per cent and Tanzanians, through the government, to control 16 per cent of Twiga Minerals.
Other terms of agreement included the payment of
Finally, early this year,
The agreements between the government and the Canadian company marked the end of the tax dispute negotiations between the two parties and set a precedent for the issuance of future mining licences.
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