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Growth of the Tanzania’s mining industry is forecast to stagnate probably until 2018 on account of low gold production, a report by World Mining Report says.
Although gold metal is the sector’s mainstay, with the country being the fourth global producer, there are plans by the country to diversify into production of nickel, coal and uranium in the long term to compliment the shortfall, the report adds citing the Tanzanian Mining Report.
The mining industry is relatively small in terms of value, but its importance is highlighted by the fact that mining earns a significant share of the country’s export revenues.
Major foreign investors in Tanzania’s mining sector include African Barrick Gold and AngloGold Ashanti, among other multinational companies operating in the East African state. Tanzania is home to significant deposits of coal, cobalt, copper, diamonds, gold, nickel, silver and uranium, although Tanzania has long been a producer of gold (Africa’s fourth-largest producer) and diamonds.
In the long term, it is envisaged coal, nickel and uranium production are likely to become sub-sectors of Tanzania’s mining sector.
However, over the forecast period to 2018, weak commodity prices will precipitate stagnant gold production growth and are likely to delay potential new projects, the report adds, It is however expected that Tanzania’s mining sector may remain relatively uncompetitive as high taxes and royalties weigh on mining companies.
The mining code, updated in 2010 at the height of the commodities price boom, is relatively more burdensome than the mining codes of the bulk of other African countries.
As such, Tanzania is likely to find itself at a competitive disadvantage as mining companies look to slash capital expenditure in an era of weakening commodity prices. The Tanzania Mining Report has been researched at source and features Business Monitor International (BMI)’s mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values.
The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.
The Business Monitor International (BMI)’s in the Tanzania Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI’s independent forecasts and competitive intelligence on the mining industry in Tanzania.
Tanzania’s President Jakaya Kikwete has been instrumental in seeking to drive the mining sector to sustain the economy.
