Tanzania to increase the contribution of mining sector to GDP

Tanzania has set a bold target to increase the mining sector's contribution to the country's GDP from the current 6.7% to 10% by 2025. This commitment stems from the country's vision to leverage its abundant mineral resources for economic development. Gabriel Matanga, an economic analyst based in Dar es Salaam, highlighted the significant strides Tanzania has made in transforming its mining sector in recent years. Back in 2017, former President Magufuli initiated a series of reforms aimed at enhancing the government's involvement in the sector. These reforms included repealing outdated laws, introducing new regulations, and ensuring greater local participation. One key change was the requirement for large mining companies to allocate a minimum of 16% free carried interest shares to the government, effectively making the government a shareholder in these companies. This shift has not only increased government revenue through dividends and corporate taxes but also fostered transparency in the sector. Despite the challenges posed by the COVID-19 pandemic, Tanzania's mining sector, particularly gold mining, has remained resilient and contributed significantly to the country's foreign exchange earnings. As Tanzania continues to implement reforms and facilitate access to mineral markets, there is optimism about the sector's potential to drive economic growth in the coming years. The government's focus on supporting small-scale miners and improving market regulations has created opportunities for increased participation and fair trade practices. By attracting international buyers and streamlining the gold trading process, Tanzania aims to establish itself as a hub for gold trade, attracting investors from around the world. The transparent and regulated market has not only benefited small miners by offering fair prices but also deterred middlemen seeking to exploit the system. Overall, Tanzania's efforts to enhance the mining sector's performance bode well for the country's economic prospects and align with its long-term development goals.