Wednesday, June 18, 2014

THE NATIONAL MINERAL POLICY 2009: A scrutiny and analysis of the mineral epoch



Overview of the Tanzania Mineral Policy 2009
A new mineral policy was implemented during 2009 to replace the 1997 version.
The policy is divided into seven parts as presented below
The first part is introduction; in this part the policy introduces the implementation of mineral policy of 1997 in terms of its achievements and weaknesses and redresses the major concern of the new mineral policy of 2009.
The second part presents the mineral endowments of Tanzania by giving a brief abundance of minerals in Tanzania and the competitive advantages to the access of mineral resources in Tanzania
In the third part the current mineral policy presents the vision and mission of the mineral sector in Tanzania
In the fourth part, the policy presents the policy objectives which are stated in outline form
The fifth part of the policy presents the 2009 mineral policy statements which are described according to each objective stated in the policy. Also this part presents the strategies that government had put forward to achieve the altered objectives in the mineral policy.
In the sixth part the policy presents the cross cutting issues to dealt in the implemented by the mineral policy. Environmental issues, healthy, safety measures and the issues of women participation and prohibit of child labour in mining had been presented in depth.
Part seven: This is the last part of the policy which had tackled the issues concern the role of government in the mining sector. Role such as government as regulator, promoter and facilitator, as service provider and as investor had been described in this part
Ultimately the policy closes with the conclusion that gives a short insight on the comparison of the 1997 mineral policy and the major focus of the new mineral policy of 2009.


Objectives of the 2009 Mineral Policy
The new mineral policy objectives are predominantly concern with promoting economic integration between the mineral sector and other sectors of the economy, so as to maximize the contribution of the mineral sector to the economy.
Other objectives include a strengthening of the legal and regulatory frame work for the mineral sector to enhance the capacity for monitoring income and employment opportunities and strategic by the government in viable mining projects
Also supporting and promote development of artisan in participation of with other Tanzanians in gemstone mining so as to increase its contribution to the economy.
Strengthening of involvement and participation of local communities through transparent and adequate land compensation and re-settlement schemes to increase corporate social responsibilities; to promote and develop a marketing system of minerals to ensure right values of minerals traded in formal markets
More objectives are through developed local base for technical capacity there should be promotion of research development and utilization of minerals through trainings required in the sector.
Furthermore promotion of safety and hygiene conditions and environmental conservation can be attained through improved communication on the mineral sector to the public by providing education to the public and giving accurate and timely information.
Other more objectives include a strengthening institutional capacity of geological survey of Tanzania (GST) to effectively and efficiently perform its role and functions and strengthening cooperation with the regional and international bodies to take advantages of facilities, resources and information provided by the organizations.
And the objective of the 2009 national mineral policy is to encourage and promote women participation in mining activities and restricting child labor in mining activities through laws and regulations(URT, 2009)

Strength of the national mineral policy of 2009

The new policy identified opportunities for revised taxation and royalties. A new act came into force in November 2010 and paved the way for mainstreaming taxation of mineral production to align it with the Income Tax Act 2004 and other laws(Muganyizi, 2012).
Under the 2009 policy, the minister power to enter agreement with mining companies was removed and in turn the company must have invested capital of more than US$100 million (International Business Publications, 2013).
The Minerals Policy of 2009 is a people centered policy that recognizes artisan and small-scale mining operations operating alongside large-scale operations.The 2010 act establishes state ownership of minerals and allows the government to grant rights to explore, develop and produce minerals(TMAA, 2011)

Weaknesses of the 2009 mineral policy
The mining policy of 2009 does not mention any intents of bringing transparency in the governance of the sector this is a great setback to a policy that seeks to get rid of the current ills in the mining sector(URT, 2009).
Through the mineral policy of 2009 acknowledges the inadequate contribution of the mining sector to the economy which is not proportional with what is actually reaped from the sector. It does not capture tentatively measures that will be employed to curb the situation. The policy in vague language expresses some wishful endeavors of making sure that a fiscal regime that maximizes benefit to the economy is in place(Krelove, 2011).
On paper the government has strong laws prohibiting child labor in mining areas but the government has done far too little to enforce them. A number of children in mining areas is increasing day after day as per 2013 Tanzania has more the 800, 000 small scale gold miners, thousands of whom are children(HRW, 2013).


Implementation of the 2009 mineral policy

The objectives stated in the 2009 mineral policy, had been in implementation stages whereas, some had met while others not.

Sector Growth and Contribution to GDP

The contribution of the mining sector to Gross Domestic Product (GDP) increased steadily from 1.4 per cent in 1998 to 3 per cent in 2008, but declined to 2.5 per cent and 2.4 per cent respectively between 2009 and 2010 during the onset of the Mineral policy. In terms of growth, the mining sector has recorded two-digit growth rates for most of the period, but saw a significant decline between 2008 and 2010, mainly due to the world economic crises. For 2008, 2009 and 2010, growth was 2.5 per cent, 1.2 per cent and 2.7 per cent respectively. Operationally, the gold sector has continued to outperform, though revenue accrued to the government has been below expectations, particularly given the significant increase in gold production(Muganyizi, 2012, p. 15).
The reforms undertaken in mining taxation have resulted in a sound fiscal regime. The Income Tax Act has mainstreamed the taxation in the mining sector and the VAT Act has reduced multiple concessions granted to mining and drilling operations. The Minerals Policy 2009 and the Mining Act 2010 have also placed emphasis on the need to have a fiscal system that generates adequate revenue for the government(Krelove, 2011).

Environmental impacts in mining areas

Outcry of people surrounding gold mine projects about pollution has been a characteristic of many mining projects in Tanzania, North Mara Gold Mine project being one of them.  In 2009 during the onset of the National mineral policy there was a heavy metal and Cyanide leakage from the mining tailing dam.
The environmental situation in North Mara is very worrying. For a while people have claimed that the tailing dam is leaking and so fear contamination of the area. The area surrounding the tailing dam is not fenced. In May 2009 a major spill occurred at the mine affect River Tighite and Nyabigenacausing fatal health hazards to human beings, livestock, and land in Kebasula Ward in Tarime, where the mine is located.The spills had edverse impact on the villages whereby more than 40 people died while plants and domestic animals died after contaminated with the water of Tighite and Nyabigena. Although the government was not able to disclose the number of people animals died (The Daily News, November 2, 2009).


The picture below shows impact of chemical spill from NMGM on people and domestic animals


         
The status of child labour in mining areas

In 2009 the Tanzanian government launched the National Action Plan on the elimination of child labour. Under its mining child protection and employment law of 2010 the government also prohibits children under the age of 18 years from engaging in hazardous work including mining. Occasionally government officially inspects mines for child labour.
Despite these positive actions, the government 2009 mineral policy remains unimplemented, its child labour inspection process is flawed, and key ministries are failing to priotise and devote resource to enforce child labours laws(HRW, 2013).
Taking Geita gold mine as a case study, in 2013 the Human Right Watch (HRW) conducted a survey Tanzania on child labour and admits that about 40% of all children ranging from 5-17 of age are in hazardous child labour and mining area inclusive, in Geita for instance, about 40% of all children are in gold mine under cheap labour services(HRW, 2013).