HomeBase MetalsMajor mining reforms expected in Tanzania

Major mining reforms expected in Tanzania

Tanzanian minister
of energy and minerals
William Ngeleja
Arusha, Tanzania — MININGREVIEW.COM — 17 December 2009 – Stakeholders from the mining sector in Tanzania, together with representatives of foreign mining companies, are meeting for a three-day session to discuss implementation of mineral policy and the new mining act in the East African country.

Permanent secretary in the Ministry of Energy and Minerals David Jairo says the mining sector is anticipating major legislative reforms following several amendments to the country’s mining act.

allAfrica.com quotes minister of energy and minerals William Ngeleja as saying that since the country’s mineral policy was formulated in 1997 over US$ 2.5 billion (R18.75 billion) has been invested in the Tanzanian mining sector..

Deliberations regarding changes to the country’s mining act have been gaining momentum for the past year. Recommendations for changes include: the increase of mining royalties on metals from 3 to 5%; the halting of  tax relief on fuel imports for gold mines; the increase of royalties on rough diamonds and gemstones such as tanzanite from 5 to 7%; and the introduction of a 3% royalty for cut and polished stones.

The media have not been allowed to attend the meetings, but will be allowed into the final session tomorrow to hear what decisions have been made.

Tanzania’s mining industry currently contributes approximately 2.3% to the country’s annual GDP, a figure that the government is looking to expand to 10% by 2025.

The production of gold and diamonds has traditionally been the foundation of the mining industry, with Tanzania becoming the third largest gold producer in Africa behind South Africa and Ghana. It is also among the top producers of diamonds in the world.

In addition, the discovery of substantial uranium deposits in the country has helped attract even more international attention which, according to observers, could help stimulate an increase in the capital inflow to Tanzania.