10 November 2012

Tanzania: Investment Policies Require Fine Tuning

Dodoma — THE government through Tanzania Petroleum Development Corporation (TPDC) has signed 26 contracts for carrying out oil exploration and production activities in the country, the House was informed.

The Deputy Minister for Minerals and Energy, Mr Stephen Masele, said government is reviewing policies guiding the investment sector to ensure that the country benefits more from its vast natural resources.

He played down claims by Dr Hamis Kigwangala (Nzega-CCM) that it was high time government stopped all investment in the mineral, gas and oil sectors as the country is not adequately benefiting from the investments.

Dr Kigwangala asserted that Tanzanians are not satisfactorily benefiting from the sectors compared to other countries thus opting for cancellation of all contracts entered with the investors. He further demanded government introduce ring fencing and windfall gains tax to capture investors who do not pay taxes in the oil sector.

He added: "Why can't the government cancel all contracts that involve investors dodging taxes?" Deputy Minister Masele said that government is reviewing all policies and laws guiding investment in the sectors so as to enable the country adequately benefit from such investments.

"The government enacted the national minerals policy of 2009 and Minerals act of 2010, both with intention of ensuring that the country benefits more from these resources," Mr Masele said. However, he noted that the country has benefited from mineral sector following an implementation of minerals policy of 1997 and mineral act of 1998 but insisted that more was to be done to magnify benefits from the sectors.

On natural gas and oil, the minister said that investment in the sectors started about 60 years back but between 2010 and 2012 more natural resources were discovered following exploration in the ocean.

"The amount of gas discovered as of now is estimated to be 33 trillion cubic feet," Mr Masele said. He added that the country was now working on relevant policies and laws that would closely administer natural gas and oil exploration and production activities to enable Tanzanians sufficiently benefit from the discoveries.

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