Making the Most of the Commodities Boom: Tanzania Vuyo Mjimba

The Country Location: Eastern Africa, bordering the Indian Ocean, between Kenya, Zambia and Mozambique Land area km 2 Population, 40.2m

The Economy Import commoditiesconsumer goods, machinery and transportation equipment, industrial raw materials, crude oil. Imports – partnersChina 12%, Kenya 8%, South Africa 7.7%, India 6.9%, UAE 5.9% (2007 Exports – commoditiesgold, coffee, cashew nuts, manufactures, cotton Exports – partnersChina 10.3%, India 9.7%, Netherlands 6.5%, Germany 6.3%, UAE 4.9% (2007 Source: CIA WORLD FACTS BOOK

Economic Indicators Growth of the Tanzanian economy: (% Real) ( Mbelle, 2005)

Economic History PRESENT UJAMAA MKUKUTA/MKUZA Socialism: Economic Decline Liberalization Partial Reforms Macroeconomic Stabilization Structural Reforms LIBERALIZATION & PARTIAL REFORMS

GROSS DOMESTIC PRODUCTION Source: World Bank, World development Indicators, WDI (December 2008)

GROSS DOMESTIC PRODUCTION Source: World Bank, World development Indicators, WDI (December 2008) !! UJAMAA L % PR M & M

Allocation of GDP by Sector Source: IMF,USGS and UNCTAD 2009

Allocation of GDP by Sector Source: IMF

Monetary Policy and Financial Sector 1980-No capital or Money markets 1991 BFIA and LART 1992 Private Banks and NBFIs Bank of Tanzania Act, 1995

Inflation. Source: World Bank, World development Indicators, WDI (December 2008)

International Trade Source:

Savings Source: World Bank, World development Indicators, WDI (December 2008)

Foreign Direct Investment Source: World Bank, World development Indicators, WDI (December 2008)

Demographics Source: World Bank, World development Indicators, WDI (December 2008

National Income Distribution Source: World Bank, World development Indicators, WDI (December 2008) and Earth Trends

Minerals in the Economy Gold, Copper, Nickel, Diamond* Gemstone, Iron Ore, Cobalt, Coal and Natural Gas. Calcite, Cement, Phosphate minerals, Silver, Vanadium, Titanium, Platinum Group Metals, Uranium Salt (of all types), Stone, Sand and Gravel.

Major Actors MINERALMAJOR ACTOR GOLDBarrick Gold, Geita Gold COPPERBarrick Gold, Xstrata plc GemstoneTanzaniteOne Ltd, Artisinal miners DiamondDe Beers Group Iron OreNDC NickelAlbidon, BHP Billiton CoalTanpower Resources Natural GasOrca Exploration Group

Gold Production

Country WORLD2,500,0002,530,0002,470,0002,460,000 South Africa 465,100398,523294,671272,128 United States 366,000298,000256,000252,000 China178,000192,000225,000245,000 Ghana72,54169,27166,85266,205 Mali20,56256,04349,23055,484 Papua New Guinea 61,64161,37968,48350,000 Tanzania42743,32052,23646,000 Source:USGS (2005)

Gold and Gemstones Production Source: USGS and Chamber of Mines South Africa Gold Production

Gold Production Rankings Country % Share in World Production World Ranking African Ranking South Africa 19%16%12%11%11 United States 15%12%10% 2 China7%8%9%10%3 Ghana3% 102 Mali1%2% 113 PN Guinea2% 3%2%124 Tanzania0%2% 135 Source:USGS (2005 )

Gold Reserves Source:USGS, 2006 Mine Production (metric tons gold content) Reserves Country South Africa USA Tanzania (2%) World

Gemstone Production In thousand carats

Country WORLD61,10086,20091,80091,300 Botswana17,20023,30023,00024,000 Russia11,50021,40023,400 Australia13,4006,0588,5777,310 Angola3,6005,4906,3007,000 DR Congo4,1206,1806,1005,600 South Africa 4,0105,8006,4006,240 Tanzania Source:USGS (2005)

Gemstone Production Rankings Country % Share in World Production World Ranking African Ranking Botswana28%27%26% 11 Russia19%25% 26%2 Australia22%7%9%8%3 DR Congo7% 6%74 Angola6% 7%8%63 South Africa 7% 8%52 Tanzania0.3% 0.2% 1611 Source:USGS (2005 )

Diamond, Gemstone value chain Source: Baartjes, Mintek 2007 Exploration Production Cut & Polish Manufacture Retail Mine Set up

Diamond, Gemstone value chain Baartjes, Mintek 2007 Cut & Polish Rough Sales Rough Dealer Cut &Polish Polished Sales Polished Dealing

COPPER USGS,2007 Mine Production Reserves Country Chile USA Zambia Tanzania (0.03%) World

Mineral Policy of Tanzania 1997 OBJECTIVES to stimulate exploration and mining activities to regulate and improve artisanal mining; to ensure that wealth generated from mining support sustainable economic and social development; to minimise or eliminate adverse social and environmental impact of mining activities to promote and facilitate mineral and mineral based products’ marketing arrangements to alleviate poverty especially for artisan and small scale miners; to promote and develop Tanzania as the gemstone centre of Africa Source: Government of Tanzania Mineral Policy

Government Role Policy formulation to accommodate the overall and sectoral government policy framework. Advising on legislation, regulation and fiscal matters related to the sector. Revenue collection through royalties, annual rents, prospecting rights and licenses. Monitoring of mining activities. Collection and maintenance of geo-technical data for promotional purposes. Provision of extension services to small scale miners. Administration and inspection of mining activities, and Carrying out research on minerals.

Bank credit to private sector (%of GDP) TANZ KENYA SA S ource:USGS (2005 )

Possibilities Gold Copper Gemstone Iron ore

Looting and routing World ($138million) USA ($500million) Tanzania ($12million )

WHY(NOT) GEMSTONES Sole source of Tanzanite?Reaction of current actors Tanzania mineral policy? Researcher safety Parallels with Botswana

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