15 June 2017

Tanzania: JPM Fire Pulls Acacia Out of Hiding

Photo: The Citizen
President John Magufuli with Prof John Thornton, Chairman of Barrick Gold Canada.

Just two days after President John Magufuli received the second report on the export of mineral concentrates that revealed how Acacia Mining evaded tax, occasioning loss amounting to trillions of shillings to the government, Barrick Gold Corporation - Acacia's largest shareholder - has declared that it is ready to negotiate and pay the dues.

Barrick Gold Corporation Executive Chairman, Prof John Thornton made the commitment at State House yesterday after holding talks with President Magufuli, a press statement issued by the Directorate of Presidential Communication stated.-

Prof Thornton, who flew by his private jet all the way from Canada to Dar es Salaam, held talks with President Magufuli in the presence of Canada's High Commissioner to Tanzania Ian Myles and Minister for Constitution and Legal Affairs, Prof Palamagamba Kabudi.

Barrick Gold Corporation is the largest shareholder of Acacia Mining Limited's issued shares, holding approximately 64 per cent. Currently, Acacia operates three gold mines in the country namely: Buzwagi, Bulyanhulu and North Mara.

According to Prof Thornton, the management of Barrick Gold Corporation is willing and ready to hold talks with Tanzania based on win-win situation to ensure the evaded tax is settled.

"We had very extensive and productive discussions about the situation affecting Acacia and I have come here in order to help resolve the problem," Prof Thornton said.

He added: "I have assured the President that we are very interested in sitting down to reach resolution based on win-win situation. A win for Tanzania, a win for Barrick and our subsidiary company - Acacia."

Prof Thornton said after having extensive conversation with the President, he felt optimistic that they will reach a resolution that will benefit all parties involved.

"We will be sitting down soon with the team designated by the President and our team to go through the details. I feel good about the progress today," the Executive Chairman said.

Dr Magufuli, on his part, said the government was ready for negotiation with Barrick Gold Corporation. He said the government will form a panel of experts to represent the country in the negotiations with the mining company, including looking on how Barrick Gold Corporation will carry out its activities in the country for the benefit of all parties.

President Magufuli said apart from agreeing to pay the government dues, Prof Thornton also agreed to cooperate with Tanzania in installing a smelting plant in the country. The unprecedented visit by Barrick Gold Corporation Executive Chairman opens a new page in efforts to resolve the matter.

On Monday, this week, President Magufuli received the second report from a team of economic and legal experts. The document revealed that between 1998 and March 2017 Tanzania lost between 68.6 trillion/- and 108.5 trillion/- in revenue from mineral concentrates.

The Chairman of the second probe team that handed over the report to the President on Monday, Prof Nehemiah Osoro recommended for summoning and questioning of officials involved in the shoddy mining agreements, through which the nation incurred huge losses in government revenue.

Dr Magufuli formed the second probe team under Prof Osoro to establish the amount and value of copper concentrates exported since 1998 to 2017 for smelting.

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