Don to govt: Have shares in every mining company

BY CORRESPONDENT

25th November 2013

International Monetary Fund (IMF)

The government has been advised to formulate a policy that will allow it to own shares in each mining company that invests in the country.

The advice was issued recently by Professor Gaudens Mpangala from the Institute of Development Studies (IDS), University of Dar es Salaam (UDSM).

He said it is through such a policy that the country and people of Tanzania will fully benefit from its resources.

“The sector has failed to bring about the required development in the country because of poor policy,” he asserted.
He said there are large, medium and small mining companies operating in Tanzania but their existence does not benefit it as much as they could.
“This is because the mining policy does not guarantee the government to be a shareholder in those companies,” he said.

Explaining, he said the policy that came into existence in 1997 and its law enacted in 1998 resulted from pressure by the World Bank and International Monetary Fund (IMF) in exchange of loans and investors.

He noted that as a result, companies which invested in the country from 1999 to 2009 were exporting all the profits that they made. He said it is only in Williamson Diamonds Mine Company of Mwadui which was established in 1940 that the government owns 25 percent shares.

According to him, the trend has had very negative effects to the country’s economy resulting in failure to improve social welfare and to get required profits from the sector as well as failure to earn foreign exchange and losing opportunities to create employment. 

SOURCE: THE GUARDIAN