Tanzania’s president on Friday ordered the military to build walls around its tanzanite mines and directed the central bank to buy the precious stone to boost reserves &#8211; the latest twist in a spat with mining firms over alleged tax evasion.
“All tanzanite gemstones will be controlled and will pass through one gate and he (Magufuli) ordered the (central) Bank of Tanzania to take part in the tanzanite buying trade,” a statement from the presidency said.
President John Magufuli’s government accuses mining firms of cheating Tanzania out of its fair share of mineral wealth through tax dodging and smuggling, allegations they hotly deny.
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A parliamentary inquiry team said on Sept. 7 that it had uncovered massive smuggling of the blue-violet tanzanite gemstone, found only in the East African nation.
Magufuli ordered the military to build walls with security cameras and checkpoints around all tanzanite mining concessions in northern Tanzania “to control illegal mining and trading activities,” the presidency statement said.
“Even if someone swallows some tanzanite gemstones, they will be detected at the proposed checkpoint,” Magufuli said.
“Tanzania gets just 5 percent of revenues from the global tanzanite trade &#8211; all the rest of this precious gemstone benefits other people abroad. This is unacceptable.”
Tanzania overhauled the legal, regulatory and fiscal framework governing the mining sector with three new laws in July, sending stock in foreign-owned mining companies plunging.
The new laws established a National Gold and Gemstone Reserve under the control of the central bank.
On Sept. 7, the government confiscated a consignment of diamonds from a mine majority-owned by Petra Diamonds after accusing the London-listed firm of under-declaring the value of the stones by around half. Petra denies the charge.
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reporting by Fumbuka Ng&#8217;wanakilala; writing by Katharine Houreld; editing by Mark Heinrich
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Tanzania president military to build walls around its tanzanite mines

DAR ES SALAAM (Reuters) &#8211; Tanzania said on Saturday it planned to nationalise diamonds whose value it put at $29.5 million belonging to a mine majority owned by London-listed Petra Diamonds after it accused the miner of under-declaring its mineral exports.
 The diamonds were seized at the main airport in Tanzania’s commercial capital Dar es Salaam on Aug. 31 as they were being exported by Williamson Diamonds Ltd to Antwerp, Belgium.
The government first confirmed the confiscation on Thursday, when President John Magufuli was receiving audits by parliamentary committees on the mining sector.
“While Williamson Diamonds Ltd declared in its documentation that the value of the diamonds was $14.798 million, a fresh valuation done by the government established that the actual value of the diamonds is $29.5million,” Tanzania’s Finance and Planning Ministry said in a statement.
“Among the legal action to be taken include the nationalisation of all the diamonds seized after it was established that there was cheating involved in declaring the actual value of the minerals,” it said.
Petra owns 75 percent of the stake in Williamson Diamonds, with the remaining shares held by the government. The Williamson mine accounted for 18 percent of Petra’s revenue last year.
Officials at Petra were not reachable for comment on Saturday. On Thursday, the company said its business was conducted in a transparent manner and that it had complied with all legislation in Tanzania. 
READ: <a href="http://cnbc.africa/news/east-africa/2017/07/11/tanzania-mining-laws/">Tanzania’s President Magufuli signs new mining bills into law, this is what has changed…</a>
 The government halted the export of the diamond shipment and ordered a fresh sorting and valuation of the minerals to verify if the actual value was declared and all relevant taxes were paid.
 The statement said Tanzania’s Finance and Planning Minister, Philip Mpango, had also ordered a criminal investigation to be launched against all officials involved in declaring the value of the diamonds and issuing export permits.
 The minister also ordered the arrest of employees of the diamond mine and public officials involved in the shipment.
“Tanzania is likely losing more than $46 million each year from the export of under-cleared diamonds through this airport,” Mpango said in the statement.
 Magufuli on Thursday ordered a review of Petra Diamonds’ contract and asked senior public officials to resign over the outcome of an investigation into the mining sector.
 One minister and a deputy minister quit their posts as requested, state-run television reported.
The president’s actions are a continuation of a crackdown in a mining sector that accounts for about 4 percent of Tanzania’s gross domestic product.
 A parliamentary committee said on Thursday there were “gross irregularities” in the manner in which the Tanzanian government diluted its shareholding in Williamson from an initial 50 percent to the current 25 percent.
 Magufuli also said he had ordered law enforcement agencies to investigate allegations of under-declared diamond exports.
Reporting by Fumbuka Ng&#8217;wanakilala; Editing by George Obulutsa

Tanzania to nationalise diamonds of London-listed miner

Tanzanian President John Magufuli said on Thursday he had ordered a review of a contract belonging to Petra Diamonds Ltd in Tanzania and asked senior public officials to resign over the outcome of a probe into the sector.
“I have endorsed all the recommendations of the parliamentary probe committees for the review of the Williamson diamond mine contract,” Magufuli said in a televised broadcast.
London-listed Petra has a 75 percent stake in the mine, while the government owns the rest. Shares in the company were down 1.6 percent in morning trade.
A spokeswoman for Petra was not immediately able to comment.
Magufuli said he had also ordered law enforcement agencies to investigate allegations of under-declared diamond exports.
Magufuli’s actions are a continuation of a crackdown in the mining sector.
He has sent shockwaves through the mining industry in Africa’s fourth-largest gold producer since his election late in 2015 with actions he says are aimed at ensuring that mining companies pay a fair share of taxes.
Tanzania has passed new laws to increase mining taxes, to force companies to renegotiate their contracts and to allow the state to own up to 50 percent of shares in mining companies.
In March, it banned exports of copper concentrate or mineral sand for processing abroad, which particularly hit gold miner Acacia Mining, the biggest in the country.
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Reporting by Fumbuka Ng&#8217;wanakilala; Editing by George Obulutsa and Dale Hudson
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Tanzania orders review of Petra mine contract, seeks resignations over probe

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President John Magufuli’s policies continue to disrupt the business environment in Tanzania including a $190 billion tax bill to Acacia Mining, which has seen the company announce that it would stop works at its flagship gold mine in the country.

RMB’s outlook on Tanzania’s business environment

Tanzania has invited bids to build a 2,100-megawatt (MW) hydroelectric plant in a World Heritage site renowned for its animal populations, despite opposition from conservationists to the long-delayed project.
The East African nation considers the project at Stiegler’s Gorge in the UNESCO-designated Selous Game Reserve as vital in its bid to diversify its energy mix and end chronic electricity shortages. The project would more than double the country’s power generation capacity.
The Energy and Minerals Ministry said it expected construction of the power plant to be completed within three years, according to a document published on its website late on Wednesday.
The deadline for bids is Oct. 16, according to the document, which specifies that work must be completed within a period of 36 months, with a maximum mobilization period of three months.
The government did not say how much the project would cost and how it would raise financing.
President John Magufuli’s office said last month the long-delayed hydroelectric plant would be built “to speed up the development of the country”.
Experts from Ethiopia, which is also building new hydro-electric dams, would advise the government, Magufuli’s office said.
Critics say construction of a dam in a major river that runs through the Selous Game Reserve could affect wildlife and their habitats downstream.
Covering 50,000 sq km, the reserve is one of the largest protected areas in Africa, according to UNESCO. It is known for its elephants, black rhinoceroses and giraffes, among many other species.
The WWF conservation group said in a report in July the proposed large-scale hydropower dam “puts protected areas of global importance, as well as the livelihoods of over 200,000 people who depend upon the environment, at risk.”
“The impact on Tanzania’s largest river would affect many ecosystem services it provides. It would affect tourism in Selous downstream in some of the most abundant wildlife areas in the game reserve,” it said.
The government has also been criticized by environmental groups for granting Australia-based miner Mantra Resources rights to build a $400 million uranium mine in the sanctuary.
Tanzania said in February it needed $46.2 billion in investment over the next 20 years to revamp aging energy infrastructure and to meet soaring demand for electricity.
Investors have long complained that a lack of reliable power is an obstacle to doing business in East Africa’s second biggest economy.
Tanzania aims to boost power generation capacity to 10,000 MW on the next decade from about 1,500 MW now by using hydropower and some of its vast natural gas and coal reserves.
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Editing by Maggie Fick and Edmund Blair
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Tanzania invites bids for hydropower project in game reserve

Dar es Salaam, Tanzania &#8211; Bill Gates announced a $15 million investment to help digitise Tanzania&#8217;s health information systems and improve health data in the country. Gates congratulated members of the government of Tanzania on leading a drive to incorporate digital health and data into their policy framework.
<div id="attachment_281817" style="width: 301px" class="wp-caption aligncenter"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-281817" class="size-full wp-image-281817" src="http://cnbc.africa/wp-content/uploads/2017/08/Bill-3.jpg" alt="" width="291" height="189" />Photo: Zuma Press/RealTime Images</div>
Philanthropist Gates, co-chair of the Bill &amp; Melinda Gates Foundation, visited Tanzania earlier this month, to learn more about the country’s development priorities. The foundation believes that the effective use of data is a fundamental building block in creating robust health systems. Bill met with the foundation’s key partners in Tanzania, including government officials (among others, the Tanzanian President John Magufuli), health care workers and development executives, to understand how the country is increasing the use of data in its health sector.
A key focus of this visit was to see, first-hand, the progress Tanzania has made towards achieving the health sector&#8217;s data vision, including how innovative practices are delivering on this strategy. During the visit, Bill launched a new partnership with the Government of Tanzania which complements the Better Immunization Data Initiative by accelerating the use of existing data and developing strong data policy frameworks.
Bill also meet with public and private sector stakeholders to discuss opportunities to expand the reach of digital payments. About half of Tanzania’s population have adopted mobile money technology. These meetings helped identify opportunities for expanding and deepening the use of digital payments in the country.
During the visit, Bill toured a fertiliser factory to understand local initiatives aimed at improving the supply and distribution of fertilizer to smallholder farmers. Better access to quality fertiliser and other inputs will help farmers boost staple crop and livestock productivity. This in turn will enable farmers to both feed their families and generate higher incomes. Boosting agricultural production can ensure that healthy, nutritious food is available to all. The foundation is working with a number of partners in Tanzania and elsewhere, including GAIN, UNICEF and Johns Hopkins University, to tackle issues around undernutrition in the country.
The foundation works with partners in more than 45 African countries to reduce poverty and improve health. Some of the major areas of investment include agriculture, child health and nutrition, family planning and financial services for the poor. Between 2001 and 2016, the foundation invested more than $9 billion in Africa. The foundation plans to invest an additional $5 billion by 2021.
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<li>Content written and supplied by Bill &amp; Melinda Gates Foundation</li>
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Inside Billionaire Bill Gates’ trip to Tanzania

Dan Paget | University of Oxford
&nbsp;
The Tanzanian government has asked Acacia Mining, a subsidiary of the world’s largest gold mining company Barrick Gold, to pay approximately USD$190 billion in revised taxes, interest and fines. This latest development is a game changer in a dispute that pits mining companies against President John Magufuli’s government. It makes both nationalisation and mine closures more likely.
Until this revised tax notice was served, the overhaul of Tanzania’s mining regime had a great deal going for it. Previous policy had given miners an easy ride. Low taxes and generous license terms were sweetened by further tax breaks and exemptions.
Tanzania’s mining sector contributes nearly 3% to GDP annually. Tanzanite and diamond mines are scheduled to be joined by large uranium, coal and iron projects which are under development, but the largest operational mines produce gold. Acacia and AngloGold Ashanti run 4 large gold mines between them that extracted 37 tonnes of gold last year. According to the World Gold Council, Tanzania is the fourth largest gold producer in Africa.
Recently three 3 laws were passed that squeeze the mining companies for revenue. They include shareholding entitlements, higher royalty rates and further tax rises.
The new legislation introduced sweeping new requirements intended to support the country’s industrial goals. Mining companies are now required to train Tanzanians, give preference to local suppliers and to source from joint ventures between domestic and foreign firms if domestic suppliers cannot be found. These rules mean additional costs for miners, but a boost for Tanzanian employees and firms that could become nascent industries.
While the new requirements were all painful for mining companies, they promised significant benefits for Tanzania and merited a try. Ultimately, engineers and economists will have to calculate whether mining companies can make those concessions without operating at a loss.
But the questions are technical and the answers are not well established. It’s possible that the mines could still be economically viable even after this policy overhaul.
Whether its tactics were good or not, the Tanzanian government had reasons for adopting a brazen approach to negotiations with the mining companies too. After it announced a series of changes in 2016, it was confronted by mining company intransigence. Their development agreements enshrined protections against all manner of intrusions and impositions. They seemed resolved to impede changes by resorting to delaying tactics, legal obstacles and arbitration.
But Magufuli’s decision to scrap development agreements between the government and mining companies and to prohibit international arbitration sent a clear message: companies didn’t have a lot of choice.
His unilateral and combative approach smacks of domestic politics. But it could also serve to dissuade the mining companies from a course of resistance.
It showed mining companies how far the Tanzanian government was willing to go and how much they wanted. It quickly provoked concessions. Acacia agreed to some of the terms two weeks ago. But if it hoped these would placate Magufuli, they were wrong.
<h2>Counting to $190 billion</h2>
Until the tax bill was tabled, it seemed as though Magufuli wanted a new settlement with the mining companies. Now it looks as though he wants new mining companies.
To put the USD$190 billion figure in context, all the proven and probable gold in Acacia’s mines is worth just over USD$10 billion at today’s prices. Including sites under exploration and the further inferred and estimated deposits, there is a further USD$24 billion worth of gold, and further deposits of silver and copper.
After these minerals are mined and processed, profits will be just a fraction of that. And even if there is as much gold as guessed, it will take decades to liberate it. In short, Acacia can never make enough to pay USD$190 billion in taxes. It would close the mines before they paid a sum that tall.
The sum of USD$190 billion was reached in fines, interest and backdated tax revisions in light of two presidential committees. The first reported that Acacia had grossly under reported the amount of gold in containers of copper-gold concentrate bound for export. The second estimated the revenue that the government had lost over the years, and the tax demand takes that into account.
If the committee findings were correct, Acacia might be sitting on enough gold to pay up, but this is not likely. If the committee’s conclusions were true, Buzwagi and Bulyanhulu mines would be the second and third largest in the world. Tanzania would have produced not 55 tonnes of gold last year, but 154 tonnes. That would representapproximately 5% of world gold mine production. Sums of that scale affect shares, currency appreciation and even the world gold price, and that makes it unlikely that past production was kept secret as the committee suggests.
<h2>What next?</h2>
There are any number of reasons for the Tanzanian government’s decision to submit the tax demand – even if it doesn’t think that Acacia will ever pay. It could be a further bargaining ploy, a plea for attention, a failure of coordination or a strategic miscalculation.
But the most likely explanation is that this is part of a mounting campaign to drive the miners out of Tanzania altogether. Last week, Magufuli announced that if the mining companies continued to delay negotiations,
<blockquote>I will close all mines and give them to Tanzanians.</blockquote>
With every new development, this threat seems less and less an idle boast.

All bets off as Magufuli’s resource nationalism moves up a gear in Tanzania

Acacia Mining&#8217;s shares fell for a sixth straight session on Tuesday, a day after the gold miner was hit with a tax bill of more than $190 billion by the Tanzanian government.
Shares in the London-listed miner closed 8.5 percent lower at 169 pence, having had more than two-thirds wiped of their value since a ban on the export of gold and copper concentrates was imposed in Tanzania on March 3.
Acacia, the biggest gold miner in Tanzania, received a notice from Tanzania on Monday for $190 billion unpaid taxes dating back over 10 years.
Acacia said it did not believe it owed the money and reiterated that it had fully declared all revenues.
The Tanzanian revenue authority has not immediately responded to Reuters&#8217; requests to comment.
The London-listed company, majority owned by Canada&#8217;s Barrick Gold, is caught up in sweeping changes to Tanzania&#8217;s mining industry spearheaded by President John Magufuli who believes the country is not getting its fair share of profits from the sector.
The tax bill is four times the GDP of Tanzania and is 32 times larger than Acacia&#8217;s revenue from the two of its mines over the last ten years, according to World Bank data and research from BMO Capital Markets.
&#8220;$190 billion is simply an absurdly high number- it will not be paid,&#8221; Jefferies analyst Alan Spence said.
&#8220;Even if a resolution is found you can&#8217;t have same amount of confidence in Tanzania that this won’t happen to another company again.&#8221;
Magufuli last week threatened to shut all gold mines in Tanzania if mining companies delayed talks to resolve the dispute over billions of dollars in back taxes the government says they owe.
&#8220;These claims are hard to fathom when compared with the total revenue from these mines of $9.4 billion since inception and Tanzania&#8217;s GDP of $46 billion,&#8221; Barclays said in a note.
The government and Barrick have agreed to start talks about the ban on concentrate exports.
Reporting by Zandi Shabalala in Johahannesburg, Additional reporting by Fumbuka Ng&#8217;wanakilala in Dar es Salaam. Editing by Jane Merriman

Tanzania tax row knocks Acacia Mining shares

DAR ES SALAAM (Reuters) &#8211; Tanzania&#8217;s President John Magufuli has threatened to close down all gold mines in the country if mining companies delay talks with his government aimed at resolving allegations of tax evasion.
The announcement by Magufuli, nicknamed &#8220;the Bulldozer&#8221; for his forceful leadership style, marks a further escalation of a dispute with foreign companies like Acacia Mining over export revenues.
&#8220;We have asked them to come for talks &#8230; they have agreed to come. But if they delay those talks, I will close down all the mines,&#8221; Magufuli told a cheering crowd at a public rally in the northwestern town of Kigoma.
Magufuli has sent shock-waves through the mining community in Africa&#8217;s fourth-largest gold producer since his election late in 2015 with a series of actions he says are aimed at ensuring that mining companies pay a fair share of taxes.
READ: 
<a href="http://cnbc.africa/news/east-africa/2017/07/11/tanzania-mining-laws/">Tanzania’s President Magufuli signs new mining bills into law, this is what has changed 
</a><a href="http://cnbc.africa/news/2017/07/21/tanzania-tells-foreign-acacia-mining-staff-leave/">Tanzania tells foreign Acacia Mining staff to leave 
</a><a href="http://cnbc.africa/news/east-africa/2017/01/03/tanzanias-president-john-magufuli-the-bulldozer/">Tanzania’s President John Magufuli: The bulldozer crushing corruption
</a>The government has accused Acacia Mining, the country&#8217;s biggest gold miner, of evading taxes worth billions of dollars by under-declaring export volume and value of its minerals.

Acacia denies the allegations. The company said on July 4 it was seeking international arbitration to resolve the dispute.    The company&#8217;s decision to seek arbitration came a day after Tanzania passed new laws to increase mining taxes, force companies to re-negotiate their contracts and allow the state to own up to 50 percent of shares in mining companies.
AngloGold Ashanti, which owns Tanzania&#8217;s biggest open-pit mine, Geita, also said last week that it was filing for international arbitration after the overhaul of the mining laws. Barrick Gold Corp., which owns a 63.9 percent stake in Acacia, agreed last month to hold talks with the government to resolve the tax evasion claims against Acacia.
 The talks are yet to begin but officials said they could start &#8220;soon.&#8221;
<div class="DPSlot_container_2dHIN DPSlot_inline_1oeo6 in-article-tag"> The president said he had taken on multinational companies for the sake of the country.</div>
&#8220;I have launched an economic war,&#8221; he told the crowd at the rally.
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Reporting by Fumbuka Ng&#8217;wanakilala; Editing by Duncan Miriri and Jane Merriman
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Tanzania’s President Magufuli threatens to close mines if talks delayed

Sekou Toure Otondi | University of Nairobi
As Kenya’s general election beckons the race has effectively narrowed down to two horses. Either, opposition leader Raila Odinga , or incumbent Uhuru Kenyatta will be Kenya’s president after August 8.
The bid for State House has attracted eight presidential contenders in total. But in recent weeks the focus has shifted to Odinga’s National Super Alliance and Kenyatta’s Jubilee Party, both of which have recently unveiled their manifestos.
While the manifestos look good on paper, depending on one’s political leaning, they are unlikely to have a significant impact on how Kenyans will cast their votes. The majority of the electorate have already decided on their preferred candidate. Most will vote on the basis of their tribal affiliations. The latest polling by Infotrak shows that only 8% of Kenyans are undecided on which presidential aspirant to vote for.
Despite the fact that party manifestos will not shift voting patterns, they do provide a policy snapshot of what the parties would prioritise were they to form the next government.
The fact that neither the Jubilee Party nor the National Super Alliance manifesto takes much account of relations between Kenya and its peers in the East African Community, is noteworthy. And disturbing.
A study of the two manifestos shows that neither has a coherent plan for regional integration. This should concern Kenyans, as well as the country’s neighbours.
Relations between Kenya and its neighbours aren’t as they could be. A few months ago cabinet secretary for foreign affairs Amina Mohamed accused Kenya’s neighbours of not backing her candidature for the chairmanship of the African Union commission. Uganda openly disputed the claims, which only served to bring more attention to the suspicions.
More concerning are the increasingly unpredictable relations between Kenya and Tanzania. Even as the campaign heats up a diplomatic row is raging between the two countries.
Tanzania and Kenya are key actors in the EAC integration process. According to the 2016 Kenya economic report, Kenya, Tanzania and Uganda account for the largest intra-trade volumes within the EAC sub-region.
Therefore, Tanzania’s protectionist tendencies, which include both tariff and non-tariff barriers, not only threaten free trade within the community, but also encourage other states to place their own national interests before those of the union.
Tanzania’s overt nationalism is likely to stymie the integration process. Thus the need for Kenya and Tanzania to quietly resolve their differences before they escalate into an open diplomatic row.
<h2>Fractious regional relations</h2>
There have long been cracks in East Africa’s fledgling union.
Since the 2013 general election that ushered in the Jubilee administration, Kenya’s engagement in the community has become increasingly low key. The result was the formation of an informal coalition of the willing, which included Rwanda, Uganda, and Kenya. It’s goal was the fast-tracking of regional integration through large scale regional infrastructure projects. These countries came together in reaction to Tanzania’s lukewarm approach to community affairs. At the time the informal coalition was formed, Tanzania was under the leadership of President Jakaya Kikwete.
Following the election of President John Pombe Magufuli in 2015, Kenya’s engagement with Tanzania has slackened even further. The cold relations between the two countries is partially explained by the diplomatic charm offensive that Magufuli launched to restore Tanzania’s influence in the region. His efforts scuttled the coalition of the willing and sidelined Kenya within the bloc.
A potent and noxious mix of competing interests have aggravated the frosty relationship between Kenya and Tanzania. There is stiff competition between the two countries to host large scale regional projects. There have also been disagreements over trade deals.
The standoff is threatening the integration process because the other community members are finding that they have to align themselves with either Kenya or Tanzania. This is getting in the way of joint decision making.
A highlight of the competing views in the region surfaced during the signing of the European Union/East African Community economic partnership agreement when Kenya and Tanzania once again took opposing views.
Tanzania has always opposed the trade deal on the grounds that it was contrary to its national economic interest. Kenya’s view is that Tanzania wants to scuttle the economic progress of the east African bloc.
<h2>Tensions fuelled by elections</h2>
Differing points of view between political elites in the region have also contributed to dampened community relations. Whenever one of the member states goes into an election, other community leaders will align with either the opposition or the incumbent. These alignments are usually based on personal relationships rather than common ideology.
Forming alignments based on a shared ideology would indicate that the integration process was on course. More so because the East African Community’s ultimate objective is to form a political union and a shared ideology would go a long way to that end. But, instead of staking cross-border political support on ideology or regional policy frameworks, support continues to be pegged on personal relationships.
This is detrimental to the integration process. In 1977, the first East African Community suffered a similar fate when it collapsed under the burden of personal differences between leaders in the bloc.
Nevertheless, the political goodwill of individual elites in community governments cannot be gainsaid. Politicians will always be at the centre of the policy that governs the integration process.
It’s on this basis that I argue for the inclusion of more detailed East African Community-related policy in the manifestos of Kenya’s main political outfits. Whoever forms the next government needs to factor in the big matter of community integration.

Op-Ed: Why it  matters that regional integration has taken a back seat in Kenya’s election

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Tanzanian President John Magufuli, signed into law new mining bills earlier this week, which require the government to own at least a 16 per cent stake in mining projects.

Tanzanian govt seeks more in stake in mining sector

DAR ES SALAAM, July 10 (Reuters) &#8211; Tanzanian President John Magufuli said on Monday he has signed into law new mining bills which require the government to own at least a 16 percent stake in mining projects.
The laws, which also increase royalties tax on gold and other minerals, were passed by parliament last week despite opposition from the mining industry body.
Magufuli reiterated on Monday that no new mining licences would be issued until Tanzania &#8220;puts things in order&#8221; and that the government would review all existing mining licences with foreign investors.
&#8220;We must benefit from our God-given minerals and that is why we must safeguard our natural resource wealth to ensure we do not end up with empty mining pits,&#8221; Magufuli told a rally in his home village in Chato district, northwestern Tanzania.
The president has sent shock-waves through the mining community with a series of actions since his election in 2015, which he says are aimed at distributing revenue to the Tanzanian people.
The new mining laws, which were fast-tracked through parliament, raise royalties tax for gold, copper, silver and platinum exports to six percent from four percent.
They also give the government the right to tear up and renegotiate contracts for natural resources like gas or minerals, and remove the right to international arbitration.
&#8220;I would like to thank parliament for making the legislative changes. I signed the bills into law the same day Parliament concluded its session on July 5,&#8221; Magufuli said.
Passage of the new legislation also followed months of wrangling between the government and the country&#8217;s biggest gold miner, London-listed Acacia Mining Plc, over mining contracts after Magufuli decided in March to ban exports of gold and copper concentrates to push for the construction of a domestic mineral smelter.
Magufuli said on Monday that talks between Tanzania and Barrick Gold Corp., Acacia&#8217;s majority owner, would begin in two days to try to resolve allegations of tax evasion against Acacia.
Tanzania accused Acacia of tax evasion in 2016 in a case that is ongoing.
Acacia, which denies all allegations, said on July 4 it was seeking an adjudicator to resolve its dispute with the Tanzanian government.
http://cnbc.africa/news/2017/06/29/tanzania-laws-allow-govt-tear-mining-energy-deals/
Tanzania is also pushing for the mandatory listing of mining companies on the Dar es Salaam Stock Exchange (DSE) by August as part of measures aimed at increasing transparency and spreading wealth from the country&#8217;s natural resources.
Other major foreign-owned mining companies in Tanzania include AngloGold Ashanti and Petra Diamonds.
Reporting by Fumbuka Ng&#8217;wanakilala; editing by Elias Biryabarema and Susan Fenton

Tanzania’s President Magufuli signs new mining bills into law, this is what has changed…

On Wednesday, May 24, President John ‘The Bulldozer’ Magufuli fired Minister of Energy and Minerals Sospeter Muhongo, Energy Ministry Permanent Secretary Justin Ntaikwa and Tanzania Minerals Audit Agency (TMAA) Chief Executive Dominic Rwekaza – in addition to dissolving the agency’s board of directors. 
The move comes after a report by a presidential committee tasked with investigating the sector found that mining companies had been under-declaring the value of their exports. 
http://cnbc.africa/news/2017/05/24/tanzanian-president-fires-mining-minister-chief-state-run-agency/
Magufuli set up two committees to look into the mining sector. The first, constituted by academics and professionals in the sector, was tasked with investigating the contents of concentrates in containers held at Dar es Salaam port and presented its finding to the president on Wednesday. The second, made up of lawyers and economists, is tasked with looking into the economic impact of exporting concentrates and has yet to release its findings.
Singled out for special attention in the president’s televised address on the issue was Canadian mining firm Acacia Mining (majority owned by Barrick Gold) – the largest gold miner in the country. 
The company has denied any wrongdoing. According to The Citizen, the investigation found an average of 1,400 grammes of gold per tonne of mineral sand in containers, but the TMAA had only indicated an average of 200 grammes. Reuters reported that the firm had declared 1.1 tonnes of gold in the containers while the analysis by the committee had shown there was as much as 15 tonnes in them. 
Furthermore, discrepancies between recorded copper and silver ratios and actual amounts were found while royalties on compounds like iron, sulphur, rhodium, iridium and lithium were not being paid despite them forming part of the concentrate. 
The committee recommended that the ban on exports of metallic and mineral concentrates, in effect since March 2, should remain in place. 
Acacia’s stocks plummeted 14% on the London Stock Exchange in reaction to the announcement. In 2016, gold and copper concentrate amounted to 30% of Acacia Mining’s group revenues. It stated in March that it was losing $1m a day due to the ban on the exports of concentrates. 
The mining sector has become a significant source of export revenues. 
Gold is Tanzania’s most important mineral with regard to exports and the only mineral amongst its top-four export commodities. Receipts from the yellow metals rose 23.9% y-o-y during the year ending March, reaching just under $1.5bn. The mining sector currently accounts for around 3% &#8211; 4% of GDP, but the government has stated that it plans on increasing the sector’s contribution to 10% of national output by 2025. 
This latest development comes after a long line of initiatives taken by the government to overhaul the sector which has pitted it against mining firms and dented investor confidence. 
Last year the government issued regulations making it compulsory for holders of special mining licences to sell 30% of their companies via initial public offerings within two years. The regulations were amended in February to make the new deadline August 23. Acacia Mining listed on the Dar es Salaam Stock Exchange (DSE) in 2011 and it is unclear how the regulation would affect it. 
Other miners – such as AngloGold Ashanti and Petra Diamonds – still need to list. 
On March 2, the ministry of energy and minerals banned the export of concentrates in order to force companies to process them in the country by setting up gold smelters. 
According to media reports, 99% of gold mined in the country is already processed there, with the concentrate left for export needing complex technology to separate – a claim Magufuli, a trained chemical engineer, rubbishes. 
A mining executive was quoted in The East African on March 22 saying &#8220;A study done in 2011 showed a smelting plant in Tanzania will cost $500m. Raising the money will be difficult as smelting cannot be profitable in the country.&#8221; Of particular concern is the lack of a steady supply of power from the national grid. 
Investors, who prize policy and regulatory certainty, will be rattled by the confrontational approach Magufuli has taken. But, on the other hand, investors dislike rampant corruption and may appreciate a president that appears to be getting Tanzania’s house in order. 
Cleaning up the country’s bureaucracy is an almost religious calling for the president. 
Addressing a congregation on April 30, the devout Magufuli said “What we do (in fighting evils) aims at straightening the country to facilitate fast, real economic development. I want you to believe that I&#8217;m doing this on your behalf, the presidency is yours&#8230; I am trying to act in the will of God&#8230; as the country, we had reached a terrible point, we were heading to a disastrous end.” He later added “Maybe the country was waiting for somebody like Magufuli to cleanse it.” 
The worrying use of the third person aside, such statements are important in understanding his self-image. 
The Manichean Magufuli is on a mission, but he is fighting corruption by firing rotten apples and micromanaging rather than by building institutions and opening the political space so that a strong opposition can keep the government in check. 
His route is unsustainable as it is centred around himself. 
Investors, and ordinary Tanzanians, would get both greater certainty and a sustainable method of keeping corruption in check if he only embraced democratic consolidation and directed his fervour toward institutional development.
Jared Jeffery is a Political Analyst and Jacques Nel, Senior Economist at NKC African Economics

Behind Tanzania’s President John ‘The Bulldozer’ Magufuli’s mining sector cleansings

Tanzania President John Magufuli fired his mining minister and the chief of the state-run mineral audit agency on Wednesday after an investigation into possible undeclared exports by mining companies to evade tax.
Magufuli&#8217;s decision, announced in a televised speech, signals an escalation of tensions between the government and the mining industry, which has denied engaging in tax evasion.
Mining accounts for about 4 percent of the East African nation&#8217;s gross domestic product.
Magufuli said the investigation 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.
&#8220;The committee (investigating the exports) found that there were many other minerals in those shipping containers that were not declared, such as sulfur, iron, iridium, titanium and zinc,&#8221; Magufuli said. &#8220;They were also under-invoicing the actual gold, copper and silver content in those shipping containers.&#8221;
The report said that Acacia declared about 1.1 tonnes of gold in the containers but an analysis established that the shipment contained up to 15 tonnes.
The company denied any wrongdoing and said it had not yet seen the report.
&#8220;Acacia reiterates that it fully declares everything of commercial value that we produce and pay all appropriate royalties and taxes on all of the payable minerals,&#8221; the company said in a statement.
SHARES PLUNGE
Acacia&#8217;s share price fell by more than 14 percent to 374 pence after the announcement &#8212; its biggest fall since March 3. By 1111 GMT (7:11 a.m. ET) the shares had recovered some ground to 388 pence, down 10.6 percent.
Acacia, majority owned by Barrick Gold, has three Tanzania gold mines that also produce copper. It is also exploring in other parts of Africa.
Magufuli also said that the Minister for Mines and Minerals, Sospeter Muhongo, and the state-run Tanzania Minerals Audit Agency (TMAA) were guilty of failings in the monitoring of gold and copper concentrate exports.
&#8220;I like Professor Muhongo very much &#8230; he is my friend, but I would like him to assess himself on this issue and vacate his position without delay,&#8221; Magufuli said after receiving the report on examinations of more than 250 impounded shipping containers of gold and copper concentrates.
Magufuli also sacked the agency&#8217;s chief executive, Dominic Rwekaza, and disbanded the board of the mineral audit agency, saying they failed to supervise exports properly.
Neither Muhongo nor representatives of the Tanzania Minerals Audit Agency were immediately available for comment.
Magufuli, nicknamed The Bulldozer for his propensity to push projects through, launched a major crackdown on corruption shortly after taking office in 2015.
The anti-graft drive has felled ministers, the head of the port, the tax chief and thousands of civil servants, though some companies claim they are being fined for crimes they did not commit.
(Writing by Katharine Houreld; Editing by David Goodman)

Tanzanian president fires mining minister and chief of state-run agency

Tanzanian President John Magufuli ordered the immediate release of a popular local musician on Monday, a day after he was arrested for allegedly mocking the government in a song.
Police had accused Ney wa Mitego of showing disrespect for the presidency in his newly-released Swahili rap song entitled Wapo.     The lyrics of the song do not mention Magufuli by name but question the infringement of freedom of speech in Tanzania. It also criticises the leadership of the country.
Magufuli, nicknamed &#8220;the bulldozer&#8221; for his strict leadership style, has won some praise from Western donors for anti-corruption drives and cutting wasteful government spending since coming to power in November 2015.
But opponents accuse him of becoming increasingly authoritarian, undermining democracy by curbing political activity and cracking down on dissent.
More than 10 people, including university students, have been charged in different court cases over the past few months for insulting the president via social networking platforms, such as WhatsApp.
Insulting the president was made a criminal offence in Tanzania under a cybercrimes law passed in 2015, punishable by up to three years in jail, a fine of around $3,000, or both.
The government described the arrest of the musician and the banning of his song by a state-run arts council as &#8220;drastic measures&#8221;.
Tanzania&#8217;s information minister, Harrison Mwakyembe, told journalists the president wanted wa Mitego to rework the song .    &#8220;It should be improved to also talk about other evils in society, such as tax evasion and drug trafficking,&#8221; the minister quoted the president as saying to him.
Police confirmed that the musician was released on Monday without charge.
Activists and opposition leaders had criticised the arrest.
&#8220;The president has no right to authorise a song by an artiste or not to. It was wrong to arrest Ney and the president&#8217;s order is meaningless too,&#8221; opposition leader Zitto Kabwe said via Twitter.
(Reporting by Fumbuka Ng&#8217;wanakilala; Editing by Duncan Miriri and Gareth Jones)
&nbsp;

Tanzanian frees musician arrested for mocking the government

The Arusha Declaration of <a href="http://www.oxfordscholarship.com/view/10.1093/acprof:oso/9780199679966.001.0001/acprof-9780199679966-chapter-20">1967</a> is a defining document in Tanzania’s and Africa’s post colonial history. It began a process of nationalisation and <a href="https://www.britannica.com/place/Tanzania/Economy">rural collectivisation</a> which was then replicated in other parts of the <a href="http://www.tandfonline.com/doi/abs/10.1080/02533950008458699?journalCode=rsdy20">continent</a>. <img loading="lazy" decoding="async" src="https://counter.theconversation.edu.au/content/73881/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" />
As one of the few countries in East Africa not beset by internecine conflicts, Tanzania is often seen as a <a href="http://www.theeastafrican.co.ke/news/Rwanda-among-least-peaceful-countries-Tanzania-high/2558-1891216-view-printVersion-14piq48/index.html">beacon of hope</a>. But the country’s history hasn’t been entirely peaceful.
For example, the creation of the <a href="http://www.sadc.int/member-states/tanzania/">United Republic</a> in 1964 was the outcome of a <a href="http://allafrica.com/stories/201201120789.html">bloody revolution</a> in Zanzibar. And the forced resettlement of the rural population in the 1970s was <a href="https://academic.oup.com/afraf/article-abstract/101/405/509/52353/Almost-an-Oxfam-in-itself-Oxfam-Ujamaa-and">often brutal</a>. The supposedly backward south of the country was most affected by this <a href="http://www.jstor.org/stable/40984999?seq=1#page_scan_tab_contents">social engineering</a>.
Julius Nyerere, Tanzania’s first post-independence leader, might be rightly revered across Africa for the role his government played in various <a href="http://www.sahistory.org.za/article/tanzania-and-its-support-southern-african-liberation-movements">liberation struggles</a>. But his domestic agenda isn’t recalled with the same fondness, especially in the south.
Multiparty democracy came to Tanzania in <a href="http://www.gsdrc.org/document-library/multiparty-democracy-in-tanzania/">1995</a>. Yet the autocratic and paternalistic tendencies remain, as reflected in the extremely heavy-handed nature of the response to <a href="http://www.thecitizen.co.tz/News/national/Why-Mtwara--violence-is-beyond-gas-pipeline/1840392-1861170-u5mncc/index.html">unrest in Mtwara in 2013</a>.
This is also echoed by the actions and rhetoric of current President <a href="http://cnbc.africa/news/east-africa/2017/01/03/tanzanias-president-john-magufuli-the-bulldozer/">John “the bulldozer” Magufuli</a>. While some celebrate his “no nonsense” attitude when it comes to tackling corruption and excessive government spending, others express major concerns over his ban on opposition <a href="http://www.thecitizen.co.tz/News/Enough-politicking--JPM-tells-Opposition/-/1840340/3264682/-/15iu05dz/-/index.html">political rallies</a> until the 2020 general election. He’s also drawn ire for the failure of his government to implement court <a href="http://www.thecitizen.co.tz/News/Implement-our-rulings--rights-court-tells-TZ-govt/1840340-3833490-t71ylhz/index.html">rulings on human rights</a>.
And the country has witnessed major protests at the management of newly discovered <a href="http://www.bbc.co.uk/news/world-africa-22652809">reserves of natural gas</a> in the south.
As a result there’s a widespread view across southern Tanzania that for half a century the central government has pursued a deliberate process of mistreatment and <a href="https://books.google.co.uk/books/about/The_Making_of_a_Periphery.html?id=mcabzHC8N70C&amp;redir_esc=y">marginalisation</a>.
Rural collectivisation is a significant milestone in such claims, a process that was kick-started by the Arusha Declaration. The document’s 50th anniversary is a prescient moment to reflect on its impact and the legacy of autocratic rule in Tanzania.
<h2>Tumultuous times</h2>
My <a href="https://doi.org/10.1017/asr.2016.26">fieldwork</a> over many years in southern Tanzania has revealed widespread scepticism about the value of independence to the inhabitants. Uhuru – or independence – from Britain in 1961 is seen to be a less significant moment in the lives of many rural Tanzanians than the Arusha Declaration.
As a 90-year old farmer told me:
<blockquote>Tanganyika became Tanzania and our flag changed, (Queen) Elizabeth left and (President) Nyerere arrived. The leaders knew about these changes but nothing changed for me… Change came after Nyerere’s speech in Arusha, he told us about ujamaa and we were forced to move from our villages.</blockquote>
Many Tanzanians living in the southern parts of the country feel the same way. This isn’t surprising given that the declaration triggered rural collectivisation (villagisation) which brought about tangible changes to people’s lives. It also cemented the language of <a href="http://pdfproc.lib.msu.edu/?file=/DMC/African%20Journals/pdfs/political%20science/volume8n1/ajps008001004.pdf">ujamaa</a> or “African Socialism”.
Villagisation was guided by the belief that communal farming could improve agricultural productivity and guarantee long-term food security and self-sufficiency.
At the outset Nyerere declared that migration to ujamaa villages would happen voluntarily. Forcing people to move wouldn’t be countenanced by the state.
But when only 15% of the total population chose to resettle between 1969 and 1973 the governing Tanganyika Africa National Union <a href="https://core.ac.uk/download/pdf/2787373.pdf">decreed</a> that:
<blockquote>to live in villages is an order.</blockquote>
Nyerere’s increasing sense of urgency is reflected both in his famous phrase <a href="https://www.cambridge.org/core/services/aop-cambridge-core/content/view/78ABA581AA13EDCC6C964A4AF3AC75E1/S0022278X0300421Xa.pdf/we-must-run-while-others-walk-popular-participation-and-development-crisis-in-tanzania-1961-9.pdf">“we must run while others walk”</a> and in the decision to rapidly transform voluntary migration into mass resettlement. Many people that I interviewed recalled this as a brutal process.
<blockquote>People were moved by force, the soldiers came, they came to worry the people, and they were taken, all of their things <a href="http://roar.uel.ac.uk/4950/">were destroyed or put in a truck</a>.</blockquote>
Not all recollections of this process were universally negative. But first hand experiences of villagisation had a profound and lasting impact on many people.
These were tumultuous times in the country, also reflected in increased authoritarianism in Tanzania from the late 1960s onward. Renowned Ugandan academic <a href="http://www.columbia.edu/cu/mesaas/faculty/directory/mamdani.html">Mahmood Mamdani</a> describes the events as <a href="http://press.princeton.edu/titles/5839.html">“decentralized despotism”</a> – a paternalistic urban elite making decisions for the “backward” rural poor. This, he argued, bore many of the hallmarks of colonial modes of rule within post colonial power structures.
There have been other critiques of the ujamaa villages project. It not only affected people on the ground but also precipitated a <a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1467-7679.1975.tb00439.x/pdf">national food crisis</a>.
One of <a href="https://doi.org/10.1017/asr.2016.26">my interviewees</a> blamed Nyerere directly for
<blockquote>destroy[ing] our farms and houses to build something that he called the nation.</blockquote>
<h2>Why caution is required</h2>
Magufuli’s sky high national <a href="http://allafrica.com/stories/201609160870.html">approval ratings</a> show no signs of abating. This adds further fuel to the <a href="http://africasacountry.com/2016/10/whatwouldnyereredo/">comparison</a> that is made with Julius “father of the nation” Nyerere.
The autocratic nature of Nyerere’s rule, informed by a clear <a href="https://www.cambridge.org/core/journals/african-studies-review/article/div-classtitlecolonial-legacies-and-postcolonial-authoritarianism-in-tanzania-connects-and-disconnectsdiv/CAB95D655FDF2C003FE2A9CE128CDF28">sense of paternalism</a> towards the rural majority, mirrors the colonial model and is reflected in contemporary political leadership in Tanzania.
I believe that there’s merit in the argument that the forcible resettlement of the rural majority under Nyerere partially mirrored colonial modes of rule. The worrying thing is that further continuities are evident in the enactment of the Arusha Declaration and the authoritarianism of today.
This should be food for thought for those heaping praise on the new regime in Tanzania.
<a href="https://theconversation.com/profiles/rob-ahearne-334689">Rob Ahearne</a>, Senior Lecturer in International Development, <a href="http://theconversation.com/institutions/university-of-east-london-924">University of East London</a>
This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/the-legacy-of-autocratic-rule-in-tanzania-from-nyerere-to-life-under-magufuli-73881">original article</a>.

Tanzania’s legacy of autocratic rule – from Nyerere to life under Magufuli

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DAR ES SALAAM (Reuters) &#8211; The number of tourists visiting Tanzania rose 10.4 percent in the 10 months to October compared with the same period last year, the finance and planning ministry said on Friday, despite higher prices for some attractions.
Tourism is the main source of foreign currency in Tanzania, best known for its beaches, safaris and Mount Kilimanjaro.
As part of an initiative to boost revenue, the government lifted an 18-percent VAT exemption in July on some tourist attractions, including wildlife park entry.
Tour operators had opposed the tax, saying it would stifle the tourism sector which employs more than 500,000 people.
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READ: <a href="/news/east-africa/2017/01/03/tanzanias-president-john-magufuli-the-bulldozer/">Tanzania’s President John Magufuli: The bulldozer crushing corruption﻿</a>
However, arrivals increased to 1,020,816 in the most recent period, according to the ministry of finance and planning.
Tanzania made $2.23 billion in 2015 from 1.1 million tourist arrivals, a slight decrease from 1.14 million arrivals in 2014.
&#8220;Claims that tourists have run away from Tanzania because of the introduction of value added tax (VAT) on some tourism services are without merit,&#8221; the ministry said in a report.
Last month, Tanzanian president John Magufuli announced plans to revamp the cash-strapped national carrier in a bid to boost the tourism and transport sectors, aiming to double annual foreign visitor arrivals.
(Reporting Fumbuka Ng&#8217;wanakilala; Editing by Aaron Maasho and Louise Ireland)
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Behind Tanzania’s President John ‘The Bulldozer’ Magufuli’s mining sector cleansings

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Tanzania’s legacy of autocratic rule – from Nyerere to life under Magufuli

Tanzania's tourism industry is booming

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