Mining sector under the microscope: Is Tanzania purposely avoiding transparency?


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Feb 11, 2007


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Joined Feb 11, 2007
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Mining sector under the microscope: Is Tanzania purposely avoiding transparency?

-New international report suggests so

Dar es Salaam

TANZANIA as a country appears uninterested in joining an international initiative administered by the World Bank that obliges resource-rich countries to show more transparency through the verification and full publication of company payments and government revenues from oil, gas, and mining proceeds.

Dubbed the Extractive Industries Transparency Initiative (EITI), the programme works to build multi-stakeholder partnerships in developing countries in order to improve governance and increase the accountability of governments.

To become fully compliant, a country needs to sign up, prepare, disclose and disseminate information on all the material revenues received by its government from the oil, gas and mining sectors with the full engagement of other stakeholders in that country.

But according to a recent EITI report, Tanzania as a country has so far failed to become a member of the organization alongside 14 other African countries that also boast of much natural resource wealth.

It is understood that most of the African countries that have entered into large-scale mining and oil exploration deals have either become full members or shown some interest in joining EITI, where membership is voluntary and there is no annual fee to pay.

’’The first step is for the government to declare its intention to join. I am not aware of any sign that the Government of Tanzania has expressed interest in joining EITI,’’ said Dr Brenda Haendler, a US State Department official dealing with EITI issues in Washington DC.

Haendler, who attended the EITI board meeting in Oslo, Norway last month, said they were also not aware of Tanzania being on the meeting agenda or not.

According to the EITI report made available to THISDAY, the initiative works to build multi-stakeholder partnerships in developing countries in order to increase the accountability of governments.

Among other things, the initiative believes that good governance is a precondition for converting large revenues from extractive industries into economic growth and poverty reduction.

’’When transparency and accountability are weak, the extractive industries may instead contribute to poverty, corruption, and conflict - the so-called ’resource curse’,’’ says the initiative on its website.

Primary beneficiaries of EITI are governments and citizens of resource-rich countries. Implementation of the initiative as part of a programme of improved governance is seen as a step forward to helping to ensure that oil, gas, and mining revenues contribute to sustainable development and poverty reduction.

’’Knowing what companies pay and what governments receive is a critical first step to holding decision-makers accountable for the use of revenues. Resource-rich countries implementing EITI can benefit from an improved investment climate by providing a clear signal to investors and to international financial institutions, that the government is committed to strengthening transparency and accountability,’’ says the initiative website.

The EITI initiative is financed in part through a multi-donor trust fund (MDTF) administered by the World Bank. France, Germany, Norway, the Netherlands, and the United Kingdom all currently contribute to the fund.

According to the latest EITI report, a total of 15 candidate countries all around the world have now been given two years to establish themselves as fully compliant to join. These are Azerbaijan, Cameroon, Gabon, Ghana, Guinea, Kazakhstan, Kyrgyzstan, Liberia, Mali, Mauritania, Mongolia, Niger, Nigeria, Peru, and Yemen.

Nine other countries have asked for more information before the end of the year, in order to make a decision about membership: Chad, Democratic Republic of Congo, Equatorial Guinea, Madagascar, Republic of Congo, Sao Tome and Principe, Sierra Leone, Trinidad and Tobago, and Timor-Leste.

Regarding Tanzania’s position, officials of the Ministry of Energy and Minerals were not immediately available to comment on why the country has not applied for membership of the initiative.

Efforts by THISDAY to get a government statement on the matter continue.

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