Tanzania lifts income from gold exports a quarter on higher volumes in 2019

TANZANIA reported an increase in earnings from gold exports notwithstanding a continuation of the export clamp-down on Acacia Mining amid a tax payments dispute.

Gold exports rose 25.1% in the year to August on the back of higher volumes, said Reuters citing the country’s central bank. Gold exports fetched $1.91bn which compares to $1.53bn in sales during the previous year.

“Gold export rose by 25.1% … driven by volume, and accounted for more than half of non-traditional exports,” the Bank of Tanzania said in its latest monthly economic report. It did not give figures for export volumes, said Reuters.

Tanzania’s government said Acacia had failed to pay sufficient tax for two decades and subsequently stopped the export of gold-in-concentrate for two years. The gold producer has since been bought over by its major shareholder, Barrick Gold. The intention is that Acacia’s gold mines are joint ventured with the government.

Tanzania, which is the fourth biggest gold producer after South Africa, Ghana and Mali, hopes its mining sector will rebound after the tax crackdown, said Reuters. Tanzanian President John Magufuli, who took office in late 2015, is pushing for more revenue from the sector, which is a relatively small contributor to national output, the newswire said.

In 2017, the government passed laws the industry complained would be costly and onerous.

Among the measures were higher taxes on mineral exports, mandated a higher government stake in some mining operations, and forced the construction of local smelters, a move some companies saw was uneconomic.

 

1 COMMENT

  1. 25% increase in income is due to gold price increase and not output. Gold output has barely changed from industrial scale producers and some of the higher production may be attributable to informal mining due to less leakage across borders and more formalized gold sales in this sector.

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