Unpublished mining contracts and a lack of data at the State Mining Company (STAMICO) contribute to a weak score by Tanzania in a measure of transparency and accountability in oil, gas and mining, according to the 2013 Resource Governance Index (RGI) report.
The Resource Governance Index (RGI) by the Revenue Watch Institute (RWI) measures the quality of governance in the oil, gas and mining sectors of 58 countries.
Tanzania received a weak score, ranking 27th out of 58 sampled countries. A relatively high score on safeguards and quality controls was offset by poor performance on other components.
The Index assesses the quality of four governance components: institutional and legal setting, reporting practices, safeguards and quality controls, and an enabling environment.
The assessment in ‘reporting practices’ says that while Tanzania provides some information on minerals production and revenues, the failure to publish mining contracts and a lack of data on the state-owned mining company contributed to a "weak" score.
Little information was available on the minerals licensing process before licenses are granted. Once mining rights are awarded, information is available only in a complex digital format for a hefty fee, and environmental impact assessments are released only upon request.
The Finance Ministry publishes information on production volumes and the value of exports, but does not provide revenue data.
The Energy and Minerals Ministry publishes data on reserves, production volumes, prices, export values, operating companies, taxes and royalties, but has yet to disclose figures on license fees, acreage fees, dividends or bonuses. The Bank of Tanzania publishes annual reports on exports and production volumes and values.
The assessment of institutional and legal setting stated that Tanzania's "weak" score is due in part to insufficient reporting requirements and the lack of a freedom of information law.
The Energy and Minerals Ministry and the Tanzania Revenue Authority both collect payments from mining companies. The companies make some direct payments to affected communities, and otherwise all revenues go to the treasury.
“After years of receiving very little in royalty payments from mining companies, the 2010 Mining Act increased the royalty rates by one to two percent depending on the type of mineral, although contract negotiations with extractive companies continue to be opaque,” the report indicated.
The index noted that environmental impact assessments are required, but companies do not always submit them before licenses are granted, and the state mining company is not required to publish revenue reports. However, Tanzania has signed on to the Extractive Industries Transparency Initiative and achieved compliant status in December 2012.
Meanwhile in relation to safeguards and quality, Tanzania received a "partial" score, its highest on any component, due in part to conflict-of-interest disclosure requirements and satisfactory checks on the budgetary process.
However, new legislation has not eliminated the discretionary powers of the minister of energy and minerals in licensing and contract negotiations.
The index says the new mining law does not clearly outline the legislature's oversight responsibilities, and Parliament does not consistently review mining revenues.
The Tanzania Minerals Audit Agency was established in December 2009. While its autonomy is questioned by some members of civil society, its creation is generally regarded as a positive development, and the agency's annual reports have increased public access to information.
In the assessment in relation to enabling environment, Tanzania has a "weak" score, with particularly low scores in government effectiveness and the rule of law. It scores poorly on corruption and accountability indicators.
Meanwhile the Index finds that only 11 of the countries, less than 20 percent have satisfactory standards of transparency and accountability.
In the rest, the public lacks fundamental information about the oil, gas sector as well as mining.
The RGI scores and ranks countries, relying on a detailed questionnaire completed by researchers with expertise in extractive industries.
As a way forward, the Revenue Watch Institute calls on governments to disclose contracts signed with extractive companies.
Ensuring that regulatory agencies publish timely, comprehensive reports on their operations, including detailed revenue and project information was also emphasized.
Extending transparency and accountability standards to state-owned companies and natural resource funds came up high in the recommendations.
Making a concerted effort to control corruption, improve the rule of law and guaranteeing respect for civil and political rights, including a free press were seen as prior conditions for enabling transparency in extractive industries as a whole.
Similarly, accelerating the adoption of international reporting standards for governments and companies was identified as key to progress in observing EITI.
The Resource Governance Index (RGI) by the Revenue Watch Institute (RWI) measures the quality of governance in the oil, gas and mining sectors of 58 countries.
Tanzania received a weak score, ranking 27th out of 58 sampled countries. A relatively high score on safeguards and quality controls was offset by poor performance on other components.
The Index assesses the quality of four governance components: institutional and legal setting, reporting practices, safeguards and quality controls, and an enabling environment.
The assessment in ‘reporting practices’ says that while Tanzania provides some information on minerals production and revenues, the failure to publish mining contracts and a lack of data on the state-owned mining company contributed to a "weak" score.
Little information was available on the minerals licensing process before licenses are granted. Once mining rights are awarded, information is available only in a complex digital format for a hefty fee, and environmental impact assessments are released only upon request.
The Finance Ministry publishes information on production volumes and the value of exports, but does not provide revenue data.
The Energy and Minerals Ministry publishes data on reserves, production volumes, prices, export values, operating companies, taxes and royalties, but has yet to disclose figures on license fees, acreage fees, dividends or bonuses. The Bank of Tanzania publishes annual reports on exports and production volumes and values.
The assessment of institutional and legal setting stated that Tanzania's "weak" score is due in part to insufficient reporting requirements and the lack of a freedom of information law.
The Energy and Minerals Ministry and the Tanzania Revenue Authority both collect payments from mining companies. The companies make some direct payments to affected communities, and otherwise all revenues go to the treasury.
“After years of receiving very little in royalty payments from mining companies, the 2010 Mining Act increased the royalty rates by one to two percent depending on the type of mineral, although contract negotiations with extractive companies continue to be opaque,” the report indicated.
The index noted that environmental impact assessments are required, but companies do not always submit them before licenses are granted, and the state mining company is not required to publish revenue reports. However, Tanzania has signed on to the Extractive Industries Transparency Initiative and achieved compliant status in December 2012.
Meanwhile in relation to safeguards and quality, Tanzania received a "partial" score, its highest on any component, due in part to conflict-of-interest disclosure requirements and satisfactory checks on the budgetary process.
However, new legislation has not eliminated the discretionary powers of the minister of energy and minerals in licensing and contract negotiations.
The index says the new mining law does not clearly outline the legislature's oversight responsibilities, and Parliament does not consistently review mining revenues.
The Tanzania Minerals Audit Agency was established in December 2009. While its autonomy is questioned by some members of civil society, its creation is generally regarded as a positive development, and the agency's annual reports have increased public access to information.
In the assessment in relation to enabling environment, Tanzania has a "weak" score, with particularly low scores in government effectiveness and the rule of law. It scores poorly on corruption and accountability indicators.
Meanwhile the Index finds that only 11 of the countries, less than 20 percent have satisfactory standards of transparency and accountability.
In the rest, the public lacks fundamental information about the oil, gas sector as well as mining.
The RGI scores and ranks countries, relying on a detailed questionnaire completed by researchers with expertise in extractive industries.
As a way forward, the Revenue Watch Institute calls on governments to disclose contracts signed with extractive companies.
Ensuring that regulatory agencies publish timely, comprehensive reports on their operations, including detailed revenue and project information was also emphasized.
Extending transparency and accountability standards to state-owned companies and natural resource funds came up high in the recommendations.
Making a concerted effort to control corruption, improve the rule of law and guaranteeing respect for civil and political rights, including a free press were seen as prior conditions for enabling transparency in extractive industries as a whole.
Similarly, accelerating the adoption of international reporting standards for governments and companies was identified as key to progress in observing EITI.
SOURCE: THE GUARDIAN
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