The International Monetary Fund (IMF) said that Tanzania’s economy is being harmed by the government’s “unpredictable and interventionist policies” in a report whose release the East African country has blocked.
Tanzania refused to authorize the publication of the report, the IMF said Wednesday in a statement on its website. The government’s spokesperson, Hassan Abbasi, didn’t answer a call to his mobile phone.
Tanzania’s economy has been rocked by a series of policy decisions by the administration of President John Magufuli, a leader whose nickname is the “bulldozer.” During his tenure, the government has imprisoned representatives of mining and mobile-phone companies involved in disputes with the state and demanded that gold producer Acacia Mining pay a tax bill of $190-billion, equivalent to two centuries of revenue. The company, owned by Barrick Gold, is now in talks with the State to resolve the dispute.
HARARE – Zimbabwe will now allow two more private companies to explore and mine diamonds in the country, bringing to four the number of firms that will operate in the sector, mines minister Winston Chitando has said.
Last week Chitando said the country did not plan to change its ownership rules for diamonds and platinum, denting hopes among some miners the country will open up ownership as it announces mineral frameworks in coming weeks.
LONDON – Zimbabwe does not plan to change its ownership rules for diamonds and platinum, its mining minister said on Monday, denting hopes among some miners the country will open up ownership as it announces mineral frameworks in coming weeks.
HARARE – Zimbabwean gold producers may suspend operations because a foreign-exchange shortage has left them with insufficient funds to cover production costs, the main industry lobby group said.
Curbing output would deprive the country of a key source of export earnings as Finance Minister Mthuli Ncube tries to stabilize an economy wrecked by the misrule of former leader Robert Mugabe.
LUSAKA – Zambia's proposed mining tax increases will hit mineral exploration and production in Africa's second biggest copper producer, companies involved in exploration said on Tuesday.
Zambia plans to introduce new mining duties, replace Value Added Tax with sales tax and increase royalties to help bring down mounting debt, its finance minister said while delivering the 2019 budget speech last month.
HARARE – Zimbabwe's gold miner RioZim on Tuesday said it would take legal action to force the central bank to pay it in US dollars for part of its output, signalling impatience by mining companies over acute dollar shortages afflicting the economy.
The shortages have worsened since 2016 and are the biggest concern for foreign investors seeking a foothold in Zimbabwe, which is trying to recover after 20 years of economic hardship under former leader Robert Mugabe.
LUSAKA – Zambia's Finance Ministry said on Sunday that it was open to dialogue with mining companies over the government's plans to increase mining taxes.
Africa's second-largest copper producer said late last month that it would introduce new mining duties and increase royalties to help bring down mounting debt.
LUSAKA – Zambia's proposed mining tax increases would hobble Africa's second biggest copper industry, companies said on Thursday, a further warning to investors already concerned about the country's mounting debt.
Several mines would become unprofitable if the tax plans were implemented with overall copper production likely to fall, Zambia Chamber of Mines president Nathan Chishimba said.
Stakeholders in the mining sector have warned that the new law which raised royalties tax from 4% to 6% on export of minerals could scare away investors. Investors in Tanzania’s mining sector have called for more government-private sector engagement to address gaps in the country’s mining law which are posing a threat to existing and new investments. The majority who are non-residents say the mining laws in the country are still unclear, hence need dialogue between the government and industry stakeholders to address the gaps.
The seemingly increasing trend towards nationalist thinking, combined with and likely driven by growing economic inequality, has resulted in several changes in mining and tax legislation in sub-Saharan Africa countries.
Herbert Smith Freehills Africa Group co-chair and partner Peter Leon says the recent and significant changes to mining regulations in various African States have caused concern that a “regional trend of resource nationalism may be emerging”.
White & Case partner Rebecca Campbell notes that her firm’s yearly mining survey of 2018 found that about 45.1% of respondents believe that the heightened risk of resource nationalism across Africa makes it difficult to justify investment. However, with about 42% saying that the risk was manageable and about 13% believing the potential returns outweighed the risks, investor sentiment towards African mining jurisdictions has not completely soured.
Despite the apparent appetite for investment, about 64.5% of survey respondents believe that political risk or “the possibility of government interference” is the chief obstacle. This assertion implies a growing sense of caution around trends in African mining legislation, though it has yet to devolve into outright pessimism.
Market research company BMI Research commodities analyst Diego Oliva-Velez believes the increased regulatory pressure by African governments is a result of steadily improving commodity prices and secondary causes associated with unique mixtures of economic and/or political factors.
With the publication of Decree-Law no. 1/2018, of May 4, some articles of the Commercial Code, passed by Decree-Law no. 2/2005, of December 27 and as amended by Decree-Law no. 2 /2009 of April 24, which aims to reduce bureaucracy and simplify the process of setting up or incorporation of companies, as well as operations thereof, mainly in aspects that follows:
Watch the video link.
Zimbabwe’s Permanent Secretary in the Mines and Minerals Ministry, Munesu Munodawafa, is expected address delegates at the Zimbabwe Mining and Tax Law Briefing to be held on the 22th of May in Johannesburg, South Africa.
The briefing is expected to demystify and give insight into the legal framework around mining in Zimbabwe ahead of the Mines and Minerals Bill expected to be passed into law before the end of May 2018.
The briefing which will see top delegates in mining and law engaging in high-level discussions, will look at the Policy, Regulation and Mineral Tax Regime in Zimbabwe.
Mr. Munesu Munodawafa, Permanent Secretary, Ministry of Mines and Mine Development Zimbabwe will present the keynote address at the Zimbabwe Mining & Tax Law briefing, to be held in Johannesburg on 22 May 2018.
The Zimbabwe government is committed to reviving the mining industry and attract mining investment. President Emmerson Mnangagwa has pledged investor-friendly policy changes and partially scaled back a law requiring mining companies to be majority locally owned. The Act will also enable investors to apply for a waiver to the 51% ownership requirement, which will be considered on a case-by-case basis.
JOHANNESBURG (miningweekly.com) – Zimbabwe is committed to introducing mining policy certainty to win back investment and revive the industry following the swearing in of President Emmerson Mnangagwa late last year. Mnangagwa is seeking to revive the economy and attract mining investment and has pledged investor-friendly policy changes and partially rolled back a law requiring miningcompanies to be majority locally owned.
Under his leadership, the Zimbabwe government amended the Mines and Minerals Act in March, to restrict compulsory indigenisation to the diamond and platinum sectors. The amended Act is designed to ensure that, in the course of time, at least 51% of any designated extractive business is owned through an appropriate designated entity, with or without the participation of a community share ownership scheme or employee share ownership scheme or trust.
HARARE – Zimbabwe’s government plans to sign a $700-million deal with an investor that will develop a coal-bed methane site, Mines Minister Winston Chitando said.
The accord comes as new President Emmerson Mnangagwa, who took office in November, courts foreign investment to rebuild an economy that halved in size since 2000 under former President Robert Mugabe’s rule. Two other similar agreements are expected in the next two months, Chitando said in a phone interview Thursday from the capital, Harare.
“The coal-bed methane projects will be for power and other related products and by-products,” he said, declining to identify any of the investors. Most of the output from the project to be signed this month will be “channeled toward the establishment of a power plant,” Chitando said.
JOHANNESBURG (miningweekly.com) – Aim-listed Vast Resources’ 25%-owned group company Dallaglio Investments has acquired a 95% interest in the Eureka gold mine, in Zimbabwe.
Dallaglio acquired a 95% interest in Delta Gold Zimbabwe, which owns the Eureka mine, from Alpha Resources and the Industrial Development Corporation of South Africa, thereby providing Vast with an indirect 23.75% interest in Eureka.
The $4.49-million purchase price is financed by a loan from Sub-Sahara Goldia Investments (SSGI) to Dallaglio.
SSGI has an effective 24.99% interest in Dallaglio and, therefore, funding for the acquisition has been sourced by Vast's associated entities in Zimbabwe without recourse to Vast.
DAR ES SALAAM – Tanzanian President John Magufuli on Wednesday appointed a chairperson and commissioners for the country's new miningcommission, paving the way for the issuance of new mining licences.
Africa's fourth-largest gold producer is seeking a bigger slice of the pie from its vast mineral resources by overhauling the fiscal and regulatory regime of its mining sector. Magufuli sent shock-waves through the mining community with a series of actions since his election in late 2015, which he says are aimed at distributing revenue to the Tanzanian people. In July last year, he suspended the issuance of all new mining licences until the new mining commission was in place.
With the country’s new leadership, opportunities to upgrade infrastructure in the energy, mining and road transport sector have made Zimbabwe an attractive destination for investors.
Decades-long political instability, sanctions and a failing economy have seen a massive decline in Zimbabwe’s international appeal. Even as global investors turned their attention to Africa in 2015 and 2016, Zimbabwe managed to exclude itself from billions of dollars of investment over its tumultuous economic trajectory.
But, the tide has turned and Zimbabwe appears to be in the Spring of life once again.
Sternford Moyo, LEX Africa’s member in Zimbabwe gave valuable insight into the private equity market in the southern African country, at a seminar held in Johannesburg, entitled An Outlook on Africa 2018.
Johannesburg(miningweekly.com) – Sub-Saharan Africa’s mining sector will remain the riskiest in the world over the coming quarters as regulatory uncertainty rises in various markets across the region, says BMIResearch. In addition to increasing regulatory uncertainty, the region will also witness challenges stemming from underdeveloped infrastructure and small mining sectors.
However, BMI on Wednesday pointed out that the region will also receive greater investor attention owing to low labour costs, strong mining sector value growth and a solid competitive landscape.
Botswana will most likely continue as the region’s best performing country, followed by Ghana and South Africa, as a result of low country risk profiles and an above average business environment.
Improved exchange control, the Local Content law and the Nacala Logistics Corridor are stimulating domestic production, generating jobs and lifting income potential.
Significant strides in Mozambique’s legislation and policies could see a rapid turn around in the country’s economic situation. In 2016, inflation peaked at 26 percent. Today, that figure has drastically improved to an estimated 6.3 percent.
LEX Africa’s Mozambican member Dr. Pedro Couto said the Local Content law and work on the Nacala Logistics Corridor (NLC) are just two examples of positive prospects that are gaining ground in 2018. He gave valuable insight into Mozambique’s economic reformation at an Outlook on Africa seminar, held in Johannesburg in March.
Johannesburg - Moti Group is preparing to double its investments in Zimbabwe to $500m after the removal of Robert Mugabe as president in November saw the government adopt a more open approach to foreign companies.
Emmerson Mnangagwa, 75, who replaced Mugabe after the military briefly took control, has declared that “Zimbabwe is open for business” and has said he will ease the country’s local ownership rules and re-engage lenders such as the International Monetary Fund.
MARK Cutifani, CEO of Anglo American, described Chris Griffith, his counterpart at the 80%-owned listed subsidiary, Anglo American Platinum, as “keen as mustard” to explore fresh prospects in Zimbabwe which has recently thrown its doors open to investment.
Well, kind of …
Cutifani, as with Impala Platinum (Implats) CEO, Nico Muller, is cautious about how a change in president in Zimbabwe might actually alter policy towards foreign investment. Following the initial euphoria following the toppling of former Zimbabwe dictator, Robert Mugabe, a sense of watchfulness has now befallen the markets in respect of Zimbabwe, especially among the miners who have seen it all before.
Following the extensive amendments to the Mining Act, Cap.123 of the Laws of Tanzania (Act No. 14 of 2010) (the Mining Act) by the Tanzania Extractive Industries (Transparency and Accountability) Act, 2015 (TEIA) whereby a number of changes affected mineral rights holders, the Mining Act had two further amendments in 2017 as a result of a change in the Tanzanian government’s (Government) approach on the mining sector, amongst others.
The first round of amendments in 2017 were brought in terms of the Finance Act, 2017. These amendments increased the royalty rate from 4 to 6 per cent with respect to minerals exports such as gold, copper, silver and platinum. This increase has attracted some debate on how the change would affect the mining sector. In addition, the amendments introduced a clearing fee of 1 per cent (as a new requirement) on the value of all minerals exported outside Tanzania from 1 July 2017. Some stakeholders have argued that the increase in the royalty rate will have a negative impact on foreign investment in the sector.
The Mining Act (CAP. 123)
THE MINING (LOCAL CONTENT) REGULATIONS,2Ol8
The formulation of the Mineral Policy of Tanzania in 1997 and the Mining Act of 1998 boosted investment in the mining sector, which resulted into the opening of the following seven major gold mines: Golden Pride Mine in 1998; Geita Gold Mine in 2000; Bulyanhulu Gold Mine in 2001; North Mara Gold Mine in 2002; Buhemba Gold Mine in 2002; Tulawaka Gold Mine in 2005; and Buzwagi Gold Mine in 2009. These seven major gold mines boosted gold production from 1 ton of gold achieved in the 1990’s to over 50 tons in 2009.
Despite the above achievements, the public has been complaining that the mineral sector is not contributing enough to the national economy. Generally, the Government is expected to benefit from the operations of the major gold mines through payment of corporate tax, mineral royalty, local levies and other direct and indirect benefits. However, most of the major gold miners have not started paying corporate tax; instead they only pay royalties, local levies and other taxes. The public has therefore been suggesting that the Government should consider increasing royalty rates on minerals produced so as to boost Government revenue. This suggestion has also been shared by different committees formed by the Government to review the performance of the mineral sector (Kipokola’s Committee - 2004, Masha’s Committee - 2006, and Bomani’s Committee - 2008).
TMAA thought it necessary to study royalty forms and rates applicable in different countries so as to establish the best form and rate to be adopted in Tanzania for the ultimate goal of attaining a win-win situation.
A ORGANIZAÇÃO internacional African Influence Exchange (AIE), realizou a primei- ra edição do “Mozambique Women Leaders Summit 2017”, Cimeira das Mulheres Líderes de Moçambique, no passado mês de Novembro na cidade de Maputo. O encontro das mulheres, teve lugar no Radisson Blu Hotel e reuniu um grupo notável de líderes, em representação de vários campos, que partilharam as suas perspectivas sobre como as mulheres podem desenvolver com grande e ciência nos negócios...
O academico brasileiro, Grabriel Chalita, sera figura principal da Cimeira das Mulheres Lideres de Mozambique.
Mozambique acolhe Cimeira de Mulheres Lideres...
Download the Mozambican Labour Law in English here.
On 8 June 2017, Tanzania’s Minister for Finance and Planning presented the 2017/18 budget. The related Finance Bill, 2017 was made publicly available on 13 June 2017. Following parliamentary approval, the Act received Presidential assent on 30 June 2017 and became effective on 1 July 2017.
This Alert is based on the Finance Act, 2017 which includes numerous amendments of tax and other laws not mentioned in the budget speech.
The key tax amendments under the Finance Act, 2017 include but not limited to:
• Zero-rating of Value-Added Tax (VAT) on the supply of ancillary transport services of goods in transit; and exemption from VAT of importation of an ambulance by a registered health facility other than a pharmacy, health laboratory or diagnostic center
• Exemption for registered education institutions from the Skills Development Levy (SDL)
• Changes affecting mining sector as a 1% inspection fee on export of minerals will come into effect on the date to be specified by the Minister
• Imposition of a 5% withholding tax (WHT) on payments relating to specified minerals supplied by a resident person
NAMIBIA cannot just copy and paste all policies and rules which our biggest trading partner, South Africa, implements.
After the recent downgrade of South Africa by Fitch ratings, Namibia was not downgraded as some people expected.
ROMPCO, the company that operates the pipeline running from Sasol’s gas fields in Inhambane to South Africa, will know whether its application for a tariff price hike has been accepted by the National Energy Regulator of South Africa (NERSA) by the end of February.
Sasol Petroleum Temane, Lda has launched a tender to contract a company for the provision of financial assistance to local suppliers in Inhambane – Mozambique. The intention is to establish a partnership with a local financial institution with proven experience and strategy focused on Mozambican SMEs.
The sponsors of Gasnosu, a project to build a gas pipeline running from the gas fields in northern Mozambique to South Africa, say they will continue to pursue the project after losing out in the domestic gas project tender this week. “A north-south pipeline is key for Mozambique’s development” according to Marco Morgado, managing director ofMatola Gas Company which – like Gasnosu – is a joint-venture between Gigajoule and state oil company, ENH.
Italian oil company ENI is increasingly determined to invest in the Rovuma Basin in Cabo Delgado. Its board of directors announced the approval of its US$10 billion investment plan in November last year, and yesterday in Maputo the same company announced a series of tenders open to national and international companies, calling on Mozambican companies to get ready to provide services and supplies of equipment.
On Tuesday 31 January, the CTA said that the country must get ready to absorb investment in gas production in order to take advantage of the business opportunities for local business it represents.
Speaking in Maputo during a conference on gas infrastructure projects, CTA Deputy Chairman Agostinho Vuma stressed that small and medium-sized Mozambican companies must rise to the challenge of seizing the business opportunities that will be generated by the gas industry.
Mozambique's selection of Shell and fertilizer giant Yara as the main winners in the domestic gas tenders is good news for investors as it shows the professionalism of the country's new energy minister and the government's commitment to gas industrialisation, sources told Interfax Natural Gas Daily this week.
Mozambique’s ministry of mineral resources and energy (MIREME) has selected three international companies to develop a gas-to-liquids (GTL) project, a fertiliser plant and a power plant using the domestic gas allocation from the Rovuma Basin. Shell has been allocated 310-330 million cubic feet per day (MMcf/d) of gas from the Area 1 and Area 4 offshore gas fields in the far north of the country, to fuel its proposed 38,000 barrels per day GTL plant which will produce synthetic diesel, naptha and kerosene, and 50-80 MW of power.
A Cidade de Maputo vai acolher, no próximo dia 31 de Janeiro, a Conferência sobre Infra-estruturas para Gás em Moçambique.
MAPUTO- A conferência, é Co-organizada pela Confederação das Associações Económicas de Moçambique (CTA), e a Africa Influence Exchange (AIE), e visa apresentar ao sector privado local e internacional, os updates da indústria do Oil&Gas no que se refere a projectos estratégicos de infra-estruturas que criam oportunidades de fornecimentos de serviços e subcontratações na área de construção e logística para o mercado nacional.
The discovery of large natural gas reserves in the Rovuma Basin has positioned Mozambique as an exciting investment opportunity in Africa. Natural resource discoveries are attracting major investment and demanding a qualified workforce, although the large majority of Mozambique’s workforce does not possess the necessary skills. Nevertheless, Mozambique’s socioeconomic prospects heavily depend on how effectively government will manage new windfalls going forward as natural gas projects come online post 2020.
Regardless of its impressive economic growth performance over the past 15 years, Mozambique remains a low income economy. Recent growth came from a low base, and has not been very inclusive. The majority of Mozambique’s population is based in rural areas, with just 31.9% of the population living in urban areas. The urban population is growing by 3.3% per year, while the country’s overall average population growth is 2.5%. It is projected that by 2040 around 40% of the population will live in cities.
Despite the country’s current debt conundrum, the projected economic boom associated with the development of the gas sector is expected to have multiple positive externalities for the rest of the economy. To rationalise public operations, promote good governance, improve transparency and reduce fiscal risks, government has approved an independent external audit of public funds and legislation to reform public enterprises. More privatisations and the closure of public companies is anticipated over the short term given public sector mismanagement and also increased competition from the private sector. This is viewed as a progressive move for the economy in general, and provide numerous opportunities for firms looking to expand into Mozambique.
The Infra-Gas Projects Mozambique Summit will take place on the 31 January 2017 at the Radisson Blu Maputo Conference Centre. The event will be officially opened by Confederação das Associações Económicas de Moçambique, Ministério de Recursos Minerais e Energia and Ministério da Indústria e Comércio.
The full Tanzania Income Tax Act - Revised version, 2006.
Arising from the need to review the legal framework set out in the Decree No, 6/2001 of 20 February, with a view to adjusting it in keeping with the labour legislation in force and thus meet the current market demands, in the light of paragraph 2, article 83 and 269 both of Law No. 23/2007 of 1 August, (the Labour Law), the Council of Ministers Decrees. Regulation governing Private Employment Agencies - document to be discussed in detail and explained at Fundamentals in Labour Law Mozambique and Labour Relations Management Course
Arising from the need to review Decree No, 55/2008 of 30 December, that approves the Regulation governing the Mechanisms and Procedures for Employment of Foreign Nationals, with a view to adjust it to current market development challenges, in the light of article 269 of Law No. 23/2007 of 1 August, the Labour Law, the Council of Ministers Decrees. Regulation governing the Mechanisms and Procedures for Employment of Foreign Nationals - to be discussed and explained at Fundamentals in Labour Law Mozambique and Labour Relations Management Course.
In life there is always the paradox of plenty: if you possess a resource in plenty but do not have the technologies required to tap into and utilize these resources, you are at the mercy of those leaders in technology who call the shots and make new entrants toe the line, unless of course your entry spells a distinct advantage to those calling the shots.
Key players in sector to benefit from briefing in Tanzania. The Tanzania capital, Dar es Salaam, will play host to investors who want to tap into the country's vast oil and gas opportunities.
The Constitution of Mozambique establishes in its Title III, Chapter V (Economic, Social and Cultural Rights, and Duties) a number of fundamental rights, such as freedom of association (Trade Unions), the right to work and the right to strike. Additionally, the Mozambican Employment Law (Law No. 23/2007, of 1 August 2007) is applicable to all employment relationships in Mozambique. The employment relationships of foreign non-resident employees are also regulated by Decree No. 55/2008, of 30 December 2008.