Investors examining the value propositions of mining projects require a greater understanding of local regulatory, geological and geopolitical landscapes. One emerging destination for explorers and miners is Tanzania.
The history of the Tanzanian mining industry moves from colonial governance, through African socialism and state control, to policies favourable to foreign investment. British and South African mining operations opened 100 years ago in the Mwadui area. During the Second World War, however, gold prospecting was banned.
After Tanzania became independent in 1961, state institutions controlled mining there until the 1990s. That’s when the government created the Investment Promotion Policy to attract international investors to the country’s diverse mineral resources base.
Mining and quarrying contributed 5.1 percent to the Tanzanian GDP in 2018, an increase from 3.8 percent of GDP in 2014. That figure is expected to account for 10 percent of GDP by 2025.
Recent earnings from gold mining have contributed US$750 million per year in foreign exchange and tax contributions, comprising 3.6 percent of annual collections.
Exporting, selling and disposing of raw minerals and concentrates require licences. Licence holders must allocate some minerals for local processing.
Licence holders can assign their rights to others without first securing the written consent of licensing bodies. Consent of licensing authorities is not required for assigning rights to affiliates if the obligations of the affiliate are guaranteed by a parent company approved by licensing authorities or financial institutions.
Licences for large-scale mining operations in which the capital investment exceeds US$100 million are called special mining licences.
It’s a transformational acquisition, according to Day. “There is a large volume of historic exploration data, including drilling data, that the company has access to that will effectively save the company a lot of time and money.”
Tanzania has a relatively low tax burden. Corporate income tax is capped at 30 percent. Total tax revenue is 13.1 percent of GDP, a result of reforms aimed at improving tax administration while reducing evasion.
Six landlocked countries depend on Tanzania ports. Tourists are drawn to renowned natural attractions — Serengeti, Kilimanjaro, Ngorongoro and the Spice Islands of Zanzibar.
Government literature touts a high degree of investment security, thanks to political stability, free from strife and ethnic division, and bolstered by democratic rule that respects diversity of opinion and the rule of law.
Simplified bureaucracy and economic liberalisation measures are continually improved via dialogue between the public and private sectors.
Investments in Tanzania are guaranteed against political risks, nationalisation and expropriation. Foreign businesses in Tanzania can obtain credit from domestic financial institutions up to the limits established by the Bank of Tanzania.
The current 60 hole Phase 1 drilling has been designed to to verify previous results whilst also gathering additional geologic information. As part of this Phase 1 drilling program, Moab will also be conducting preliminary metallurgical testing to determine the most efficient processing pathway.
Large uranium deposits have also been found in Namtumbo, Bahi, Galapo, Minjingu, Mbulu, Simanjiro, Lake Natron, Manyoni, Songea, Tunduru, Madaba and Nachingwea.
This INNSpired article was written according to INN editorial standards to educate investors.
INN does not provide investment advice and the information on this profile should not be considered a recommendation to buy or sell any security. INN does not endorse or recommend the business, products, services or securities of any company profiled.
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