Tanzania’s Wealth Being Plundered – Bench Marks Foundation

Press Release

16 October 2008

Although gold mining is the fastest growing sector of the Tanzanian economy and accounts for nearly half of the country’s exports, ordinary Tanzanians are not benefiting, a recent study has shown.

The study titled, A golden opportunity? How Tanzania is failing to benefit from Gold mining, is published by the Christian Council of Tanzania (CCT), National Council of Muslims in Tanzania (BAKWATA) and the Tanzania Episcopal Conference (TEC).

According to the report, which has just been launched, Tanzania exported gold worth more than US$2,5 billion in the last five years but this has not benefited the citizens because the tax laws are overly favourable to multinational mining companies, such as Anglo Gold Ashanti.

As a result of the practices of these companies, Tanzania is being plundered of its natural resources and wealth. 

The report identifies three severe problems with gold mining in Tanzania, namely:

• It provides the government with minuscule tax revenues
• It is subject to minimal government and undemocratic scrutiny and has the associated problem of corruption
• People in the gold mining areas are not benefiting and many are being made poorer

“About 400 000 small-scale miners lost their jobs. The question is how does this benefit the ordinary people?” said John Capel, Executive Director of Bench Marks Foundation that works closely with CCT.

Tanzania, according to the report, is one of the ten poorest countries in the world. Some 12-million of the country’s 39-million people live in poverty, surviving on average incomes of 399,873 Tanzanian Shillings or (US$307) a year.

This report, warns that it is imperative that Tanzania earns a windfall from gold while the reserves lasts. This is because the country’s proven reserves of 45m ounces are being extracted at a rate of over 1,6 ounces a year, meaning that they may last 28 years but three of Tanzania’s six large scale mines are set to close within ten years.

The study recommends that:

• Tanzania’s mining law should be amended to ensure that the national economy, and Tanzanians, benefit much more from gold mining
• All the gold mining companies and the government should be required by law to make a full public declaration of how much they pay and receive in tax from gold mining.

Ends

Issued by Quo Vadis Communications on behalf of Bench Marks Foundation

The Bench Marks Foundation is an independent organisation monitoring corporate performance in the field of Corporate Social Responsibility (CSR) with the focus on social sustainability and economic empowerment. The organisation encourages CSR that goes beyond reporting mechanisms and focuses on the gap between policy and practice, thereby assisting civil society groups and corporations to move beyond philanthropy to more strategic interventions that benefit both the corporations and society. Central to Bench Marks’ agenda is how CSR is integrated into companies’ operations and ensuring that it is at the core of every decision making process.

Quo Vadis Communications and its staff may not be quoted on behalf of Bench Marks Foundation

Media Contact: 

Khumbulani Mpofu
Tel: 011-487-0026
Cell: 083-352-0655
E-mail: khumbulani@quo-vadis.co.za

Client contact:         
John Capel
Executive Director
Bench Marks Foundation
Tel: 011-832-1750
Email: jcapel@eject.co.za