In a
pivotal development for Tanzania’s mining sector, an agreement has been reached
between key stakeholders and the government to strengthen the country’s gold
reserves.
The
accord, which was finalized in a joint meeting between large, medium, and
small-scale miners, gold traders, the Ministry of Minerals, and the Bank of
Tanzania (BOT), will facilitate the implementation of Section 59 of the Mining
Act.
The
section mandates that 20% of all gold production be set aside for the country’s
national reserves through BOT.
The
Minister of Minerals, Hon. Anthony Peter Mavunde, expressed his deep
appreciation to all participants, acknowledging their efforts in reaching this
consensus.
"I sincerely thank the stakeholders in the mining sector, including large-scale, medium-scale, and small-scale miners, as well as gold traders. Through our collaborative meeting with the Bank of Tanzania and the Ministry of Minerals, we’ve managed to reach significant agreements on various areas, enabling us to implement the Mining Act’s Section 59 on gold reserves," he said.
The
agreement highlights several key components. The price of gold will be based on
the global gold market rates, as provided daily by the Mining Commission,
ensuring price adjustments align with global trends.
Sellers
will receive full payment (100%) after the refining report is issued. Payments
will be processed within 24 hours of receiving the report, and in some cases,
as demonstrated by transactions on October 2, 2024, payments were made in as
little as six hours.
Further
easing the burden on miners, the BOT has agreed to cover 100% of the costs
associated with refining the gold.
The
agreement also stipulates that licensed mining operators and large-scale
traders will allocate 20% of their gold production for national reserves.
To
encourage compliance and participation, the government is offering incentives,
such as a reduction in royalties from 6% to 4%, the elimination of the 1%
inspection fee, and the introduction of a 0% VAT.
The
measures will allow gold sellers to claim input tax, further increasing their
profitability.
In
addition to these provisions, the agreement allows licensed mining operators,
large-scale traders, and gold refining companies to sell any amount of gold
directly to the BOT, offering flexibility in the sale and purchase process.
The initiative is expected to bring about greater transparency, efficiency, and profitability in Tanzania’s gold sector.
"This
is a groundbreaking achievement for Tanzania," remarked Minister Mavunde.
"Under
this new plan, licensed miners, traders, and refining companies can sell any
quantity of gold to the Bank of Tanzania. This allows the nation to maximize
its mineral wealth while ensuring miners receive fair compensation," he
added.
The mining
sector remains a vital pillar of Tanzania’s economy, and this agreement
represents a forward-looking approach to leveraging the country’s natural
resources for national growth.
By
securing gold for the country’s reserves, the government is ensuring that
Tanzania’s economic future remains strong and stable.