Tanzania’s parliament has passed two controversial laws to bring about far-reaching reforms in the mining sector.
One law explicitly states that the Tanzanian people will have permanent sovereignty over all natural wealth and resources and ownership and control will be exercised by the government on behalf of the people.
This means private companies would mine on behalf of the nation, whereas before, the law stated that “once firms signed a contract with the government, they owned the minerals.”
Another law empowers parliament to review all agreements made by the government regarding natural resources.
The two pieces of legislation follow months of dispute between President John Magufuli’s government and UK-listed mining firm, Acacia over revenue sharing.
Acacia is accused of under-reporting the gold and copper levels in its concentrate exports by more than 10 times and of underpaying the government tens of billions of dollars over the two decades it has been operating in the East African country.
The company strongly denies any wrongdoing.
Mining companies and lobby groups had urged the government to delay passing the two laws to allow for more consultation.
The government, however, pushed ahead with gaining parliamentary approval for the legislation.