An Indian investor, Abhijeet, has started negotiations with small scale miners in Kilindi District, Tanga Region aimed at assisting them to import latest technology in mining industry.
According to the company’s director of Africa Department, Abrahim Khan, already 2bn/- has been set aside by the firm for the programme.
He said his company is negotiating with local mining companies, including the small miners to establish joint ventures in various regions.
“We want to import latest mining technology for small scale mining to help improve mining techniques. We have seen the miners using outdated techniques,” he noted.
He said they have also offered foodstuff and clothing to small miners in the district, who he said has have been operating in terrible conditions.
“We have seen most of the small miners working under serious difficulties. They have high risk of losing lives because their mining operations are not environmentally friendly. They spend a lot of time in digging rocks without reaping anything,” he observed.
The Abhijeet director also said that most Tanzanians engaging in the mining business seem not to be ready to set accept joint ventures for mutual benefits.
“We have been negotiating with them to sign joint venture contracts, but they appear to be reluctant. It seems they are looking for quick money. They are for royalties alone accrued from their mining permits,” he noted.
He added: “We have been asking them to bring forward their business write-ups so that we can negotiate smoothly for joint venture operations, but they are not ready. Worse, they do not have documents indicating that they possess mining permits with geologically surveyed areas possessing economic viability.”
Under the Mining Act of 2010, foreign investors are supposed to reserve 15 percent of their earnings for the benefit of Tanzanians and also have to ensure that the interests of small scale miners are protected.
Further, the law bans new foreign investors from engaging in gemstone mining like tanzanite, ruby, diamonds, emerald, sapphire, turquoise, topaz and others.
However, long time foreign gemstone investors are not affected by the new ownership rules.
The law also binds mining companies to list on the Dar es Salaam Stock Exchange (DSE) and openly declare their business performance including capital gains, proceeds and other forms of profits.
Already the royalty has been raised from three to four percent, but negotiations for local retention of 15 percent of earning from mining businesses are still going on between the giant gold mining firms and the government.