History
The earliest organized prospecting and mining in Tanzania took place during the German colonial period, beginning with gold discoveries in the Lak Victoria region around 1894. Mining began at Ngasamo and Sekenke Mines in 1909. After 1930, gold production was substantial and increased steadily until World War 2. By 1967, the gold industry had declined to insignificance, only to revive after 1974-1975 when the world gold price increased greatly. Until 1998, production was mostly from artisanal mining and State Mining Corporation (STAMICO) but production has greatly increased since the new policies encouraging foreign and private investment have been in place.
Current Situation
See Figure 3 Pg 19 (Ministry_Doc.pdf)
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Tanzania continues to be one of Africa's biggest mining success stories, endowed with geology which is highly prospective for gold and other minerals and offering a stable political environment with sound legal and fiscal policies. Within the ten years of the early 1990's Tanzania has risen from an insignificant gold producer to becoming Africa's third largest gold producing country.
The Tanzanian Mining Record Through 2008 (ICMM Report)
Remarkable Improvement in FDI (Foreign Direct Investment)
See Table 3.1 & Figure 3.1 Pg 16 (ICMM_Report.pdf)
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The improvement in Tanzania's ability to attract foreign direct investment (FDI) in the past decade has been truly remarkable. As UNCTAD's 2008 World Investment Report shows, this increase has now placed Tanzania in the higher ranks of African economies in terms of FDI and at the very top of the list in terms of non-oil countries. The major single reason for Tanzania's sustained high performance in recent years has been the massive new inflows of capital for investment in the mining sector.
Increased Total Exports - Gold a Major Contributor
See Figure 3.2 Pg. 17,
See Figure 3.3 Pg 18 (ICMM_Report.pdf)
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The very significant growth of total exports seen in Tanzania since 1999 is almost wholly accounted for by the growth of the non-traditional export sectors within which mining prodacts and manufacturers are the major elements.
Growth of GDP
See Table 3.2 Pg. 19,
See Figure 3.5 Pg. 21 (ICMM_Report.pdf)
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The evidence shows the share of total GDP attributable to mining has risen clearly and consistently. Mining and the construction sectors are the only identifiable dynamic sectors in the overall and impressive GDP growth seen since 1998.
Increase in Tax Revenue
See Table 3.3 Pg. 22 (ICMM_Report.pdf)
Download the entire file: ICMM_Report.pdf (670KB)
The mining sectors contributions to total tax revenues have shown significant increases. These increases have meant that even before the effects of the long-lived depreciation allowances unwind, the sector has been able to contribute a share of total government tax revenues that is almost commensurate with its share of total productive activity. Even in it's infancy the sector can already claim to be a major tax player
Conclusions
Overall, these macroeconomic contributions are substantial and they represent an important part of the explanation of Tanzania's strong performance in macroeconomic terms in recent years. This is especially so given the very short life span of the new mining investments: in a real sense this is still an industry in its infancy in Tanzania.
Artisanal Miners
Artisanal mining activities have always existed in Tanzania. In the late 1980's, the Government organized a series of miners' associations to transform and upgrade artisanal mining into organized and modernized mining, principally in gold and gemstones. This move coincided with a major increase in artisanal mining activity, which is estimated to employ over 500,000 people. The enactment of the Mining Act, 1998, and its subsequent Regulations, 1999, which ensure transparency and fairness in licensing procedures, has minized the number illegal miners and illegal trading of minerals in the country.
