Tanzania: Sweeping Reforms Yield Revenue Boom in Mining Sector

By Alvar Mwakyusa

REVENUE collections in the mining sector have soared to the current 470bn/- from an annual average of 196bn/- in the past four years, thanks to sweeping reforms in the lucrative industry.

Minerals Minister Doto Biteko, speaking in an exclusive interview with an online television- Maelezo TV-which is run by Tanzania Information Services, attributed the great achievements to government efforts to curb cheating in the industry, especially smuggling of minerals and gemstones.

Minister Biteko explained that construction of the fencing wall around Mirerani Tanzanite mine in Manyara region has enabled the government to increase the quantity of the rare gemstone which is exclusively found in Tanzania from just 166 kilogrammes per annum to 1.09 tons.

"As we speak, there are over 33,000 mining licence holders in our database out of whom 13,167 have been revoked over failure to develop the mines.

These mining blocks will be redistributed to small and medium scale miners," he explained.

Among others, the minister recorded in the past four years to establishment of mineral trading facilities in some regions as well as incorporation of artisanal miners who had been dismissed as illegal.

"Before the establishment of the mining trading markets, it was hard for the government to collect revenues while miners were also being cheated by unscrupulous traders," he explained.

Mr Biteko explained that the directives by President John Magufuli on the establishment of mineral centres have made Tanzania an example not only in the East African but in the African continent.

"The creation of the markets has made trading of minerals and gemstone very transparent because the government gets its fair share of revenues while miners also receive reasonable payments for their produce," he stated.

He explained on the other hand that construction of the fencing wall around Mirerani and installation of Closed Circuit Television (CCTV) cameras have played an important role in checking smuggling of Tanzanite, enabling the government to collect its fair share of revenues.

Speaking in a previous interview with the 'Daily News', Mr Biteko explained that the mining licence holders had responded positively to payment of part of permit fees amounting to 116.67bn/- they owed the government on the mining blocks they were allocated.

The minister had in February 18, this year, instructed the Mining Commission to serve a 30-day notice to companies that own 18,341 mining licenses to pay the arrears or risk losing their licenses.

"Some of the licence holders have requested for an extension of the deadline to make payments.

As of March this year, we have revoked licenses of 11 companies which failed to pay for their licence," he then explained during the interview.

According to the minister, the Mining Commission had issued 30,973 mining licences out of which 18,341 had not paid fees amounting to 116.67bn/-.

A verification conducted by the Ministry of Energy in February, according to Mr Biteko, found out that the defaulters had already been served with defaulting notices but the permits had not been revoked as prescribed by the law.

Giving breakdown on the amount of money that the government claims from each licence category with the amount in brackets, the minister mentioned prospecting licenses (61.67bn/-), special mining licenses (6.41bn/-), mining licenses (28.28bn) and primary mining licenses (19.51bn/-).

Mr Biteko had argued that since the Mining Commission had served the defaulters notice to 110 prospecting licence and 52 mining licence holders, their licenses should be withdrawn in seven days.

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