Tanzanite One licence renewal bid faces ‘uncertainty’

Tanzanite One’s bid to renew its licence - that expires in March - for the mining of a rare gemstone in Tanzania is doubtful as it comes at a time the country has started implementing a revised mining law that allow locals to exclusively mine the stones. The company was also facing accusations of failing to contribute much towards the treasury.
A newspaper article written by a local socio-economic commentator Karl Lyimo claimed that the tanzanite company had contributed nearly $10 million to Tanzania’s economy in the form of corporate taxes ($5.3 million), royalty ($4.4 million), and $201,898.73 in gemstones levy from 2005 to 2009.
“That’s less than $2 million yearly for a $400-500 million global income. In such a situation, I cannot see how the authorities would justify renewal of the company licence when it expires in March,” he wrote.
“Our decision-makers surely cannot be that naive, that imprudent, and that insensitive to the situation on the ground.”
However, TanzaniteOne’s corporate governance manager and company secretary, Lusekelo Mwakalukwa told the local media recently that the company was optimistic that its licence would be renewed.
“We have applied for a mining license for gemstone under the new Mining Act of 2010. We hope the new law will not affect us because laws do not operate retrospectively,” Mwakalukwa was quoted as saying.
Meanwhile, Lyimo noted that although Section 8 of the revised 2010 Mining Act stipulated that gemstone mining would solely be done by Tanzanians, it also provided room for foreign firms to get licences in cases where heavy investments and sophisticated technology was required.
“This last bit is wherein the devil lies. It’s a loophole that gives the grandly corrupt in the corridors of power leeway to circumvent the law and prolong wanton exploitation of the peoples’ natural resources for the benefit of a few aliens,” he said.  

Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished