By Bernard Lugongo
TANZANIA's revenue from the mining sector continues to swell, proving yet another determination by the fifth-phase government under President John Magufuli, to boost and finance its socio-economic development.
The country has received a 100bn/- dividend from the Twiga Mineral Corporation Limited, a joint venture between the government and Barrick Gold Corporation.
"Tanzania is very rich and there is no reason to fail implementing development projects over lack of funds...unlike in the past when we even asked donors to construct pit latrines for our schools," Dr Magufuli stated at an event to receive the dividend staged at the Julius Nyerere International Convention Centre (JNICC) in Dar es Salaam.
Twiga Mining Company handed over the share to the government alongside the State Mining Corporation (STAMICO), which gave a dividend of 1bn/- to the State.
After the handing over of the dummy cheques to the government, President Magufuli pointed out that the money would go to bring impact to the country's social services.
"We have got 100bn/-, which will be channeled towards improving social services provision such as education, health care and so on," Dr Magufuli explained.
He attributed the success to the mining sector reforms during his first five-year term of his government, whereby in February 2019, a series of changes were made to Tanzanian mining laws and regulations.
The government amended the Mining Act which, among other provisions, raised the royalty rate from 4 to 6 per cent with respect to minerals exports such as gold, copper, silver and platinum.
As per the new mining legislation, the government is entitled to acquire (in total) up to 50 per cent of the shares in a mining company, proportional with the quantified value of tax expenditures incurred by the government in favour of the mining company.
Under these legal reforms, the government and the Barrick formed the Twiga Mineral Corporation under the agreement that the government holds 16 per cent of shares and the Barrick taking 84 per cent. However, the profit from the company is shared under the 50/50 arrangement.
"These agreements are now bringing a positive impact to the poor Tanzanians," Dr Magufuli said, as he commended a team of experts led by Prof Palamagamba Kabudi during talks with the Barrick for review of the mining agreements.
He said the agreement that the government entered with the Barrick was one of its kind in the history of the mining sector in the country and beyond.
"Even my fellow Presidents from other countries have been asking me over how we managed to do it," he explained.
President Magufuli noted that since the reforms in the sector, a lot of achievements have been attained, including raising the contribution of the mining sector to the country's Gross Domestic Product (GDP) from 3.4 per cent in 2015 to over 5 per cent currently.
The revenues from the mining has risen during the past five years from 168bn/- to 528bn/- currently.
Speaking over the STAMICO, the President noted that the state company has now undergone massive transformation and was making profit.
The company was making final touches to establish a Gold Refinery in Mwanza city that would have capacity of processing 480kg of gold per day.
"I take this opportunity to encourage investors to come and invest in the mining sector, Tanzania has a good environment for investment," he said.
Earlier, the Minister for Minerals, Doto Biteko said President Magufuli has completely changed the sector after introducing several measures meant to increase government share from the precious resources.
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