Tanzanian president orders immediate review of mining laws

Source: Xinhua| 2017-06-12 21:27:17|Editor: MJ
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DAR ES SALAAM, June 12 (Xinhua) -- Tanzanian President John Magufuli on Monday ordered relevant authorities, including Parliament, to immediately review and amend mining laws to ensure that the east African nation benefited from its resources.

Speaking shortly after he was presented with the second report on mineral concentrates in the commercial capital Dar es Salaam, the President also ordered the review and amendment of laws pertaining to the oil and gas industry.

Nehemiah Osoro, the chairman of a special committee that compiled the second mineral concentrates report, said the report revealed that there was massive cheating by mining companies on the amount of gold exports and tax evasion.

For example, said Osoro, the report showed that between 1998 and March 2017, between 44,000 and 61,000 containers of mineral concentrates worth between 49.12 billion U.S. dollars and 83.32 billion U.S. dollars were exported outside the country without the country getting a single cent from royalties and taxes.

"This is daylight robbery. We have to take hard decisions to stop this from happening again," said the president.

He added: "These laws should be reviewed and amended for the benefit of country. We need investors but they should operate on a win-win situation. We should share the benefits of our resources."

At the same time, Magufuli ordered the investigation of all former and current government officials who were involved in the signing of mining agreements that led the country to incurring losses amounting to billions of U.S. dollars.

He said the officials to be investigated included former mining ministers and senior lawyers who entered into mining deals that created loopholes for foreign mining companies to rip-off the country.

"Our children are dying for lack of medicines while our gold is being exported abroad without our knowledge. This must stop now," fumed the president, adding that with its abundance resources Tanzania was not supposed to be labeled as poor.

President Magufuli was vividly angry when the report revealed that Acacia mining company had no records showing it was registered in Tanzania.

On May 24, Magufuli sacked Minister for Energy and Minerals Sospeter Muhongo after the first report on mining concentrates showed he was implicated in mining firms' undeclared mineral sand exports.

The report revealed that the undeclared mineral sand exports led to tax evasion by the mining firms.

Magufuli said the report revealed that mining firms, including Acacia Mining, cheated over mineral sand exports for smelting abroad, making the east African nation to lose millions of U.S. dollars.

Magufuli asked the minister to resign when he was reacting to recommendations made to him in the report by a special committee he formed in March to investigate on how mineral sand was transported abroad by mining firms for smelting without paying due taxes.

The president also dissolved the Tanzania Mineral Audit Agency (TMAA) Board of Directors and suspended the agency's Chief Executive Officer, Dominic Rwekaza, for what he termed as negligence.

The report revealed that Acacia Mining declared the presence of gold, copper and silver in its mineral sand exports but did not declare other precious metals in the consignments, the president said in a televised address.

Mining accounts for about 4 percent of Tanzania's gross domestic product.

Acacia, majority owned by Barrick Gold, has three Tanzania gold mines that also produce copper.