Archive for Issue 118

TA ISSUE 118

TA118 cover features a miner at Bulyanhulu Gold Mine (photo Acacia Mining)

Mining Sector – The Mineral Sands Export Saga
Challenge to Schooling Ban for Pregnant Girls
Key “Escrow” Suspects Arrested
Obituaries
Book Reviews

A pdf of the issue can be downloaded here

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THE MINERAL SANDS EXPORT SAGA

by Roger Nellist

Tanzania’s mining sector in difficulty – the background
As reported in TA117, in March the government took the controversial step of banning the export of mineral concentrates and ores for metallic minerals such as gold, copper, nickel and silver. Later the same month, President Magufuli had intervened personally, ordering the seizure at Dar port of 277 containers of mineral sands destined for export mainly from two gold mines operated by Acacia Mining (Tanzania’s largest gold-producer), and asserted: “There is no country being robbed of its mineral wealth like Tanzania”. Samples were taken from the sands for analysis. Several foreign mining companies were immediately affected by the export ban but local miners and other entities also expressed concerns. In April, Magufuli established two expert teams to report to him quickly on different aspects of the mineral sand exports. Since then the saga has intensified, triggering an avalanche of robust follow-up actions by government – including more sackings and contentious new legislation.

Tanzania is variably listed as Africa’s third or fourth largest gold-producing country so, unsurprisingly, the saga has generated much news coverage and comment, both in Tanzania and abroad. There have been headlines like: “Industrial-scale plunder of Tanzania’s mineral wealth by multinational companies”, “Probe team unearths massive thievery in mineral sand exports”, “Tanzania has been losing trillions of shillings in revenue” and “Tanzania’s Acacia spat shows deepening battle with business”.

Two Presidential probe reports
President Magufuli received the two reports in person at State House, presented by the respective expert teams, with the presentations broadcast live on national media. The first took place on 25 May, led by Prof A. Mruma, the head of the Geological Survey of Tanzania. Their report found that the containers impounded at Dar’s port held real minerals with a value totalling up to TSh 1.4 trillion that had not been declared for tax or recorded by the Tanzania Minerals Audit Agency (TMAA). Minerals discovered in the concentrates included gold, silver, copper metal and sulphur, as well as quantities of undeclared strategic minerals like lithium. The team said it found an average of 1.4kg of gold per tonne of mineral sand in the containers, seven times as much as reported by TMAA. It also uncovered other discrepancies. Mruma’s committee recommended that the export ban on metallic mineral concentrates be maintained, effective scanners be installed at Dar’s port, containers be sealed immediately after testing, that government should ensure smelters are built in Tanzania to maximise the full value of minerals produced and that disciplinary action should be taken against officials in the Ministry of Energy & Minerals (MEM) and in the TMAA.

On 12 June Magufuli received the second report, concerning the economic impact of the mineral sands exports. This team, led by Prof N Osoro, estimated that between 44,000 and 61,000 containers of gold and copper concentrates had been exported between 1998 and March 2017, most emanating from two mines run by Acacia (formerly Barrick Gold). It estimated losses in government revenue running into trillions of shillings over the two decades – through under-declaration of both export volume and value of gold and copper concentrates. Magufuli announced: “The report says the amount of unpaid taxes between 1998 and March 2017 through illegal exports of gold and copper concentrates is between TSh 68.59 trillion and TSh 108.5 trillion”. Such sums would be enough to cover Tanzania’s national budget for three years and build about 1,000 kms of railway line between Dar and Mwanza. Describing the losses as “criminal”, Osoro’s committee made 21 far-reaching recommendations – principally that: responsible senior public officers (past and present) should be charged with complicity in tax evasion, abuse of public office, economic sabotage and fraud; all Mining Development Agreements (MDAs) and mining laws should be reviewed; all new MDAs should be approved by parliament and the terms of all MDAs should be made public; government should take a stake in all large mines; overly generous tax concessions should be removed; and there should be strengthened security at mines to reduce smuggling.

The government’s response
Inevitably, the two reports produced very strong reactions from many quarters, including demands for a major overhaul of Tanzania’s mining laws and arrangements. In a parliamentary session after the first report, MPs were close to unanimous in expressing their shock. They offered many suggestions on what should be done and called for officials in MEM “who have been telling lies” to be investigated. They also called for Energy & Minerals Minister Sospeter Muhongo and his Deputy Minister to be held to account for the mistakes of their subordinates and, since the scandal has been ongoing for years, for his predecessors to be investigated too.

President Magufuli took quick action. Immediately after publication of the first report he cancelled Muhongo’s appointment as Minister, saying “The Minister is my friend but I want him to reconsider his position …. I am advising him to step down”. State House indicated that there would be no immediate replacement for him. Magufuli also dissolved the Board of TMAA and suspended its CEO. These sackings came on top of the earlier dismissal of MEM’s Permanent Secretary, allegedly for lying to parliament about the concentrates.

The President was incensed after receiving the second report on the revenue losses. Saying he was left “utterly speechless” by its findings, in a televised response he declared: “Enough is enough. We have been given raw deals for too long and this has to end. … Even the devil is laughing at us over our own self-inflicted level of poverty amid natural wealth given to us by God.” He demanded that Acacia Mining – if it wanted to continue mining in the country – pay billions of shillings in tax due since 1998 as arrears and dared the company to sue his government. Calling on Acacia to repent, Magufuli said he would not discuss anything with the company whilst debts were pending. He ordered that all 21 recommendations made in the Osoro report be implemented immediately. In early July he went further, ordering MEM not to issue any new mining licences or to renew expiring ones.

On 14 June, with only a few dissenting voices, parliament passed a resolution praising Magufuli for his actions. One MP said “this is war…. economic war”.

Then on 3 and 4 July Parliament considered and approved three hastily-prepared bills tabled by the Minister for Constitutional and Legal Affairs, Prof P. Kabudi. The three Acts (see below) make amendments to six existing laws (including the Mining, Petroleum and Income Tax Acts) aimed at strengthening government control of Tanzania’s mineral and petroleum sectors and increasing revenues from extraction activities in those sectors.

The Natural Wealth and Resources (Permanent Sovereignty) Act 2017 asserts that all natural resources belong to Tanzania and will be used only to benefit the country. It requires all disputes between the government and investors to be settled in Tanzania (no foreign arbitration) and compels companies to process minerals within the country rather than exporting them as raw materials; mineral concentrates if not smelted by the producer will be sold to whoever is able to smelt them in Tanzania and pay taxes due. We understand that this Act also allows government to own up to 50% of mining firms, and requires all earnings from the exploitation of natural resources to be banked in Tanzania (foreign mining companies may remit dividends only).

The Natural Wealth and Resource Contracts (Review and Renegotiation of Unconscionable terms) Act, 2017 requires all natural resource contracts to be made public, that parliament must endorse them, and allows the government to revoke contracts if they have “unconscionable terms” or are otherwise prejudicial to the interests of Tanzanians.

The Written Laws (Miscellaneous Amendments) Act 2017 dissolves the TMAA and replaces it with a Minerals Commission (with most of its nine members being serving Permanent Secretaries).

The debate on the three Bills, rushed through parliament in just two days, was heated, with many differing views expressed. CCM MPs supported their immediate consideration but opposition MPs questioned the urgency, arguing for more time for their public and parliamentary scrutiny. One CCM MP cautioned that “these are revolutionary measures. We need to understand what we are getting in to. … Multinationals may decide to pull out from our country and adversely affect our current account and the value of the Tanzanian shilling”. He added that to balance the risk of such negative outcomes from “our economic freedom fight” the government should invest more in small-scale mining.

The mining industry’s response
Acacia Mining operates three mines in Tanzania. Whilst its Mara North mine produces almost pure gold (and was not the subject of the probes) its two other gold mines (Bulyanhulu and Buzwagi) produce mixtures and were investigated. The company announced in April that the concentrate export ban was costing it about $1 million daily, and its shares fell on the FTSE 250 Exchange.

After the first probe report findings were publicised Acacia’s share values dropped by more than 15% in minutes. The company stated it had fully co-operated with the committee and maintained it fully declares everything of commercial value and pays all appropriate royalties and taxes on all payable minerals produced.

After the release of the second report’s findings Acacia called for an independent review of both Presidential committee reports, asserting that they contained inaccurate and unexplainable findings and allegations. It strongly refuted the “unfounded accusations”, insisting it is a law-abiding company, mining in full compliance with Tanzanian laws, paying all royalties and taxes due and publishes fully audited accounts. It called for a lifting of the mineral sands export ban (saying it was hurting its ability to conduct business in Tanzania and also badly affecting the lives of thousands of Tanzanians) and called for a resolution of the current situation. Over the last 20 years Acacia/Barrick has invested US$4 billion in Tanzania’s mining sector. In all, Acacia’s shares are now priced at less than half of their value of twelve months ago.

Within days of the second report being presented to the President, the Executive Chairman of Acacia’s majority shareholder, Barrick Gold Corporation of Canada, flew to Dar to hold talks with Magufuli. He said he wanted to help resolve the problems and, after the discussions, he and Magufuli announced they will establish two expert teams to begin negotiations to that end. The Chairman said he was optimistic about reaching a solution – one that will involve payment of any past dues and also arrangements for establishing a smelter in Tanzania. Acacia said it would not participate directly in the government-Barrick talks but would work to support Barrick.

On 4 July, before the new legislation had been signed into law by the President, Acacia filed arbitration notices in Tanzania in order “to protect the company”. It reiterated that “Acacia remains of the view that a negotiated resolution is the preferable outcome to the current disputes and the company will continue to work to achieve this”. It is understood that production continues at Acacia’s three mines.

All other mining companies in Tanzania will also be impacted by the government’s recent actions. The Tanzania Chamber of Minerals and Energy, representing the industry, said the implications of the new laws (which it had opposed) are “vast”, adding that “the industry is going to be affected big time” and that it will need extensive legal advice. External commentators are expressing concerns that, even though Magufuli has said the private sector is “an important ally”, his robust actions will unsettle other investors. One pointed to the US$ 19 billion of major infrastructure projects the government has in the pipeline and for which it needs private investors, reminding that other large private investment projects in Tanzania have also been jeopardised this year. Another commentator opined that Tanzania’s mining sector is deteriorating from a situation of relative stability and sense to becoming “yet another African basket case”.

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EDUCATION

by Naomi Rouse

Schoolgirls at Zanaki Primary School, Dar es Salaam (Sara Farhart/World Bank)

Civil Society ready to challenge the President on controversial education policy
The unequivocal statement by President Magufuli banning pregnant girls and young mothers from attending school is a setback for the ‘re-entry’ policy that had gained growing momentum in recent years. However, Tanzanian civil society and others are mobilising to oppose the ban.

The familiar arguments have been brought out: a breakdown in morality, an epidemic of pregnancies and classrooms full of pregnant girls, if you start to allow any young mothers to return to school. One CCM MP, Mr Keisy, envisaged a slippery slope towards liberalism: “We are supposed to be firm on these issues otherwise we will find ourselves approving same-sex marriage”. On the other hand, civil society organisations are highlighting girls’ vulnerability and prevalence of forced sex, girls’ constitutional rights to education, and the benefits to the whole community if pregnant girls are allowed to continue their education.

There is not an overt religious element to the debate, though one MP argued that “all religions are against this… after all, we have stringent legislation on this issue, why are we diverting from it? Why should we jail amorous men, but allow errant girls back to school?”

Opinions have not been split on gender lines, with some male politicians speaking out in support of the re-entry policy, and high-profile women opposing it, including former First Lady Salma Kikwete. However sexist arguments abound in the debate. One CCM MP challenged women MPs to tell the house if they started to engage in sexual activity while still in school. President Magufuli himself said the country would “reach a time when all the pupils in a class will be mothers and when it is time for learning they will need to go to breast-feed their children at their home”.

Salma Kikwete is perhaps a surprising opponent of girls returning to school, having established a high-profile women’s rights foundation, WAMA (Wanawake Maendeleo), with the mantra “treat every child as your own.”

Ms Nyimbo (Special Seats – CCM) pointed out in the parliamentary debate, political opposition to the re-entry policy is hypocritical because of vast disparities of wealth and power. “The fact is that if the daughter of an MP or any other well-to-do person gets pregnant while in school, chances are that that will not be the end of their educational journey. They are sure to be sent back to school after giving birth. Why should we lock out girls from poor families? How can we end the vicious cycle of poverty? Let’s be fair.”

There is a lot at stake. 55,000 girls are officially recognised to have left school due to pregnancy in the past decade, though this is likely to be significantly under-estimated. The most recent Tanzania Demographic Health Survey shows that 27 out of 100 girls in Tanzania have become pregnant by the age of 18. It is in no one’s interest to exclude girls from education, given the powerful benefits of education for girls’ income, family size and their ability to care for their families. In addition to the very pressing issue of sexual violence against girls, the question of reproductive health services for young people is still the elephant in the room.

Magufuli’s insistence that young mothers will never be allowed back to school while he is in power is a real test for Tanzanian civil society. A group of 26 organisations issued a joint statement against the ban, including one representing a further 50 member organisations. This is a sign that civil society action is better coordinated and has a stronger and more unified voice than in the past, but it could be a tough fight.

STOP PRESS: Policy draws criticism from African Commission on Human and Peoples’ Rights
On 03 August 2017, the ACHPR Commissioner Rapporteur on the Human Rights Situation in the United Republic of Tanzania and the Special Rapporteur on the Rights of Women in Africa, together with the Chairperson of the African Committee of Experts on the Rights and Welfare of the Child, transmitted a Joint Letter of Appeal to the President of the United Republic of Tanzania regarding the statement made on 22 June 2017 to the effect that pregnant girls and teen mothers will not be allowed to attend school. The Joint Letter of Appeal expressed the view of the Commission and Committee that this statement runs the risk of undermining the right to education and the right to equality of girls, and urged the State to fulfil its obligations concerning these rights in terms of the African Charter on Human and Peoples’ Rights, the Protocol to the African Charter on Human and Peoples’ Rights on the Rights of Women in Africa and the African Charter on the Rights and Welfare of the Child.

Summary of media coverage of the issue

MPs split on proposal to allow teenage mothers back to school
Parliament was divided on the proposal to allow young mothers back to school. The Social Services and Community Development Committee and the Opposition party are pushing for a change in the policy. Former First Lady Salma Kikwete was one of the high profile opponents of the policy. Support for the policy emphasised girls’ welfare whereas those opposing the policy urged the importance of maintaining an ‘ethical society’ and protecting Tanzania’s culture and customs, which prohibit sex before marriage. (The Citizen)

JPM: No going back to school once you become a mother
Speaking at a ceremony to open the new Bagamoyo-Msata road, President Magufuli spoke out against allowing girls back to school, on the grounds that this would encourage other girls to be sexually active without worrying about the consequences. Magufuli dismissed the advocacy work of NGOs and said that they should open their own schools for pregnant girls, and that the government would never accept the girls back in government schools. (The Guardian)

Women react to Magufuli’s pregnant schoolgirl ban

An online petition has been set up and a pan African Women’s organisation is mobilising to get Magufuli to apologise and reverse his comments regarding education of young mothers.
Jackie Lomboma, spoke out about her personal experiences, saying “It is a big disappointment to hear such a statement from our President”. Jackie became pregnant when she trusted a boy who promised to ask his parents to help fund her secondary education. She was kicked out of school and home, later getting the chance to go back to school. She has since set up a centre for teenage mothers in Morogoro. (The Guardian)

Opposition Coalition faults JPM stance on pregnant schoolgirls
Shadow Minister for Education, Science and Vocational Training, Suza Lyimo said she has been saddened by the president’s statement because all students had a constitutional right to education. She said they have been advocating the matter for several years, and there is already a government document explaining how pregnant girls should be allowed back to school. Zambia and Kenya have approved similar policies, and the Deputy Minister for Education had previously informed the National Assembly that the government was working on guidelines on the matter.
But President Magufuli said that the debate was closed, and the government would never allow young mothers back into school while he is in office. (The Guardian)

Teen mothers: what JPM ban portend for girls
In response to the parliamentary debate about the education of young mothers, the Citizen profiled the story of a young girl who at the age of 8 had gone to Dar es Salaam under the promise of being given an education, but ended up working as a house girl. Her neighbour offered to take care of her, but after several months said he could not take care of her for free, as she was not a relative. He made her pregnant when she was 12, and she enrolled in the MEMKWA programme in 2014, but the article highlights that some officials are even applying Magufuli’s ban to MEMKWA classes. (The Citizen)

“After getting pregnant you are done” – no more school for Tanzania’s mums-to-be
Civil society organisations are mobilising in response to Magufuli’s ban on educating young mothers. A 2013 report from the Centre for Reproductive Rights says that 55,000 pregnant girls have been expelled from school in the last decade. Equality now is supporting a coalition of over 20 organisations who have issued a joint statement against the ban. They cited success from Zanzibar where girls have returned to school without any evidence of an increase in pregnancies as a result of allowing girls back, and called for measures to address violence against girls which is a major cause of teen pregnancy. (The Guardian, UK)

Joint statement by coalition of civil society organisations on re-entry to school for girls after they have given birth
Twaweza published a joint statement from 26 organisations in support of the education of young mothers. The statement cites public opinion from Sauti za Wananchi surveys, showing 71% in favour of pregnant girls returning to school as well as referencing existing government policies which support the education of pregnant girls. The statement also highlights the prevalence of forced sex, quoting research which shows that 3 out of 10 girls are forced in their first sexual experience.
(Twaweza)

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KEY “ESCROW” SUSPECTS ARRESTED

Harbinder Singh Sethi and James Rugemalira kneel outside the courtroom

Two key suspects in the alleged corruption case around power generation contracts – popularly known as the “Escrow” case – have been arrested and charged in Dar es Salaam.

Harbinder Singh Sethi of Pan Africa Power Solutions Tanzania (PAP) and James Rugemalira of VIP Engineering and Marketing jointly face six charges of economic sabotage, forgery, impersonation, running a criminal syndicate, obtaining money by false pretence and causing loss of money to the government. This is the first time that the two, who were at the centre of one of the most high-profile scandals in Tanzania’s recent history, have appeared in court, almost three years after Parliament recommended their prosecution.

Their arrest is seen by many as a strong move by the government to bring to justice suspects implicated in mega scandals. It will also likely boost President John Magufuli’s scorecard on his pledge to combat corruption from the top. Donors and others have previously criticised what they perceived as government inaction on the case, including delaying some aid disbursements.

Mr Sethi and Mr Rugemalira were brought to the court on June 19th, under tight security. Mr Sethi knelt down and Mr Rugemalira squatted before they were led to the dock. They face economic sabotage charges relating to causing the government a loss of over USD $22m and TSh 309m. The suspects were denied bail.

Government prosecutors told the court that Mr Rugemalira, who owned a 30% stake in IPTL, and Sethi, the executive chairman of PAP, colluded with government officials in running an illegal syndicate with an intention of profiteering from their collusion. The prosecution accused Mr Sethi of forging a company registration certificate in October 2011 and lying that he was a Tanzanian resident living in Masaki area while knowing it was not true. Both the accused were said to have illegally withdrawn large sums of money from the escrow bank account.

Mr Sethi, who mostly lives in South Africa, was reportedly arrested at Julius Nyerere International Airport as he and his wife were about to fly out.

Mr Sethi and Mr Rugemalira were named in 2014 in Parliament as having overseen a plan which saw more than TSh 300bn transferred from an Escrow account held jointly by IPTL and the Tanzania Electric Supply Company (Tanesco) at the Bank of Tanzania (BoT). According to the investigations of the Tanzanian media, followed up by the National Audit Office and the Public Accounts Committee of Parliament, much of the money was shared around among a long list of high level politicians, government officials, judges and religious leaders, among others. The scandal led to the resignation of the then Attorney General, Fredrick Werema, and Energy and Minerals minister Sospeter Muhongo, while President Jakaya Kikwete fired the then Lands, Housing and Human Settlements Development minister, Prof Anna Tibaijuka. Several other senior government officials in various ministries are facing charges over their role in facilitating the matter or receiving money from the escrow proceeds.

“For a long time now, people have been curious to know the progress of our investigation on the Tegeta escrow and IPTL scandals,” said Valentino Mlowola, Director General of the Prevention and Combatting of Corruption Bureau (PCCB). “I can announce today that the prime suspects … have been arrested and will be charged with economic sabotage and other related offences.”

“I want to sincerely thank the government for charging the two businessmen over the escrow scandal as recommended by Parliament,” said Mr Zitto Kabwe, the ACT-Wazalendo party leader and Kigoma Urban MP. Mr Kabwe chaired the Public Accounts Committee that investigated the case.

Following the arrests, one of those accused of receiving a portion of the funds, William Ngeleja, the former Minister of Energy and Minerals and the current MP for Segerea (CCM), said he would return to the government the TSh 40.4m he had received from Rugemalira. Ngeleja said he had accepted the money as a “donation” to support constituency development activities and had not at the time realised the money was connected with a scandal.

PCCB public relations officer Musa Misalaba said the bureau has all the details of how the IPTL account funds were disbursed, and will use all its tools of investigation to determine the extent of impropriety, if any. He said the investigations are covering all beneficiaries and others implicated in the scandal, irrespective of whether they are politicians, public servants, religious leaders, or similar, but he declined to disclose the names of the beneficiaries.

Those widely named as having received funds from Rugemalira include Prof Tibaijuka, and Andrew Chenge, former Attorney General and current MP for Bariadi West, who are both reported to have received TSh 1.6bn. Others said to have received smaller amounts include judges, religious leaders, and employees and board members of various public institutions including Tanesco, the tax authority (TRA) and the Tanzania Investment Centre (TIC).
(The Citizen, The Guardian, Daily News, Mwananchi)

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VIOLENCE IN KIBITI

by Ben Taylor

There are some signs that the police may have turned a corner in addressing the spate of violence that has afflicted Kibiti and neighbouring districts of Coast Region in recent months.

In February three people, including a police officer, were killed by a group of bandits at a farm and forestry levies collection centre at Jaribu Mpakani. In April, eight police officers who were deployed there from Morogoro Region to bolster security were ambushed and killed as they were returning to their base from patrol.

In mid-June, a local leader and two villagers in Nyamisati village, Kibiti District, were abducted and shot at by unknown gunmen. Two weeks later, the chairman and executive officer of Mangwi Village were killed in cold blood by armed men, according to sources in the area. The killers also shot and blinded the chairman of a sub-village. And a former CCM ward chairperson was shot dead outside his home in Nyambunda village.

The total number of those killed in the area since 2014 has risen to over 40 people, according to The Citizen newspaper. The list includes local government leaders, local CCM leaders, police officers and civilians. Home Affairs Minister Mwigulu Nchemba recently informed Parliament in Dodoma of plans to establish a special police zone in Kibiti in a bid to deal with the crisis head on.

The recently-appointed Inspector General of Police, Simon Sirro, cited the restoration of peace and tranquillity in Coast Region as his number one priority, and sought to reassure residents of the affected districts that the violence will soon be brought to an end.

Policing activities in the area have stepped up, and the police claimed significant victories after each of two recent shootouts. In late June, a police patrol car was reportedly ambushed, and in the exchange of fire that followed, four of the six attackers were killed by the police. Then, in early August, the police raided a forest camp, killing 13 suspects in the confrontation.

In a statement, Mr Sirro said the police had arrested one of the suspects, who led them to the camp that the suspects had been using as a hideout. “We made efforts to try and rush them to Muhimbili National Hospital for treatment but they died on the way from the gunshot wounds,” he said.

He also said the police recovered some weapons and other items from the camp – including five sub-machine guns, 2 anti-riot guns, a pair of police uniform, one magazine and 153 rounds of ammunition as well as hand grenades and two motorcycles – adding that investigations showed that the weapons had been used in various criminal incidents, including some of those mentioned above.

Following this, Kibiti District Authorities called upon whose ward and village executives who had fled because of the violence to quickly return to their stations of duty so as to keep serving residents. He said that for now the district’s defence and security had been stepped up, so it was District councillors applauded the efforts of the government and the defence and security services for restoring peace and security in the district. (The Citizen, The Guardian, Daily News)

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CLAMPDOWN ON FAKE ACADEMIC CERTIFICATES

by Ben Taylor

President John Magufuli announced the firing of nearly 10,000 civil servants after receiving a report on public servants’ academic certificates. The following day, the full list of those accused of possessing fake certificates was published.

The Minister of State for Public Service Management, Angela Kairuki, noted that from a total of 435,000 civil servants who had their certificates verified, 9,932 were found to possess forged certificates.

The evaluation was commissioned by the President’s Office Public Service Management and Good Governance, and conducted by a 15-member team. It was a follow-up exercise after an earlier nationwide crackdown on “ghost workers” that struck 19,706 non-existent employees off the public payroll.

The exercise considered Form IV and VI academic certificates as well as teachers with certificates and diploma qualifications. It did not look at elected representatives or holders of positions directly appointed by the President, such as District Commissioners, as the law does not require such officials to hold academic qualifications beyond the ability to read and write.

Some civil servants were found to possess certificates that did not match those issued by academic institutions, while others were found to be using certificates issued to other people.

The President ordered all those whose names are in the document to voluntarily leave their jobs within two weeks or otherwise face seven-year jail terms. He also ordered any salary payments for them to be suspended.

Some of those whose names appeared on the “list of shame” have maintained their innocence, claiming possession of genuine credentials. They have said they are considering an appeal against the dossier.

Further, several commentators noted that dismissing such a large number of civil servants at the same time could have a significant negative impact on public services and public administration, particularly as there was already an estimated shortage of around 50,000 public servants in health, education and justice sectors.

“We should expect quite a disruption on social service delivery due to lost expertise and experience,” said Prof Gaudens Mpangala of Ruaha Catholic University.

“It is sad to say but the government has approached the issue of fake certificates in the civil service the same way as the anti-corruption crusade. Selective justice is at play. And the people are right to ask why should some people in the same government be forgiven while others are made accountable,” he said.

Dr Hellen Kijo-Bisimba of the Legal and Human Right Centre said to avoid the disruption of social services and to ensure justice is done to all those concerned President Magufuli should have pardoned all who were found with forged certificates and should focus his attention instead on preventing use of fake certificates among future recruits. “The war on fake certificates should be forward looking. A system should be put in place to ensure no one would be employed if they use forged certificates,” she said.

The Tanganyika Law Society (TLS) said they intend to file a case against the controversial Dar es Salaam Regional Commissioner, Paul Makonda, over alleged use of fake academic certificates. TLS President Tundu Lissu said that claims had been circulating widely that Makonda is using another person’s certificate and his real name is Daudi Bashite.

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CUF’S ONGOING TRAVAILS

by Ben Taylor

The power struggle within the opposition party, the Civic United Front (CUF), shows no signs of letting up, with several dramatic incidents having taken place over the past few months. The dispute pits a predominantly mainland faction of the party aligned with former Presidential candidate, Professor Ibrahim Lipumba, against a Zanzibar-dominated faction aligned with the former Vice President of Zanzibar, Seif Sharif Hamad.

The crisis in CUF began last year after Prof Lipumba, who had resigned as chairman ahead of the 2015 General Election, decided to rescind on his resignation. During an extraordinary national congress that had been called to elect his successor in August, Prof Lipumba dramatically forced his way in to the meeting. That did not prevent delegates voting to confirm his resignation. However, the Registrar of Political Parties, Judge Francis Mutungi, dismissed the decision by the Supreme Governing Council to expel him from the party, in a ruling that gave the professor a major boost in his bid for the CUF chairmanship.

In late April a press conference, arranged by members of the Seifaligned group in Dar es Salaam, was raided by four masked men wielding weapons, including a pistol. Several people were injured, including journalists and one of the attackers who was arrested when the police arrived. Members of the Lipumba-aligned faction admitted they had sent the people who interrupted the meeting.

In July, Professor Lipumba, empowered by Judge Mutungi’s decision, expelled eight of the party’s special seats MPs from the party, thus stripping them of their seats in parliament, and appointed eight new MPs to the positions. The changes were upheld by the Speaker, Job Ndugai.
Mr Hamad issued a press statement accusing the office of the Registrar of Political Parties, the Office of the Speaker and the Police of working to weaken the party by backing Prof Lipumba. He said the axed MPs are going to High Court to challenge the decision by Prof Lipumba, and will ask the court to declare them legitimate CUF members and therefore legitimate members of parliament.

Prof Lipumba accused Mr Hamad of abandoning office and his responsibilities.

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FOREIGN RELATIONS

by David Brewin

Foreign relations and the ‘economic war’
Ever since independence in 1961 Tanzania has enjoyed warm and friendly relations with most countries around the world. The formidable leadership of the first president (Nyerere) and his determined fight against colonialism in Africa kept him constantly in the news but there were many up and owns. Relations were broken off for a period time between Britain and Tanzania over what was then Southern Rhodesia (and later Zimbabwe) over its progress towards independence and his relations with East and West Germany because of their diverging policies.

Friction also arose over the different policies of the Communist governments in Eastern Europe and the capitalist governments in much of the rest of Europe. Nyerere had little enthusiasm for Western capitalism and tried hard to establish good relations with the then communist world. Above all he wanted Tanzania to be self-reliant and pursued this policy through, amongst other things, his forced ‘villagisation’ programme. He showed no hesitation in nationalising huge swathes of foreign owned enterprises including all the banks usually without payment of compensation.

His actions resulted in the gradual collapse of the sisal industry which had been one of the main elements of the country’s exports at that time although other factors played a part in this. A policy on tourism, which, in later years, became a major source of income for the country, was not on his priority list.

However, his great charm and the very warm relations he established with the newly emerging China and the Scandinavian countries have persisted to this day and helped to alleviate the economic situation.

By the end of his term the economy was in crisis while Nyerere concentrated on the hugely time-consuming tasks of liberating the rest of Africa, entering into a Union with revolutionary Zanzibar and on social development, particularly in education, at home. Many considered Tanzania’s economy to have become a virtual ‘basket case’ but the foundations had been laid for a socially more equitable state.

His two successors as president (Mwinyi and Mkapa) concentrated on revival of the economy and foreign capital investment began to flow again. Mwinyi and Mkapa realised that Europe and America were where the money was and efforts were made to attract some of it to Tanzania. Relations with the West became warmer again.

Then president Magufuli arrived on the scene and began a radical transformation of the economy. He calls it the ‘Economic War’’ The latest developments on this are outlined in other parts of this issue.

The arrival of the spectacularly successful new world in China has made it possible for Tanzania and other developing countries to obtain huge investment without the strict restrictions placed on other foreign direct investment. His policy of putting ‘Tanzania First’ has some features in common those of President Trump in America and his ‘America First’ policy.

Thus, Tanzania is entering a period of economic change, the eventual results of which are very difficult to determine as foreign investors wonder what their future might be and whether Tanzania still welcomes such investment.

Lake Nyasa/Lake Malawi
The boundary dispute between Malawi and Tanzania over the ownership of this lake continues. The Malawian government has threatened to escalate the dispute by taking it to the International Court of Justice in The Hague as several attempts to find a resolution have failed.

An issue of particular concern to Malawi as that the lake’s geographical space represents about a third of Malawi’s total space. Malawi argues that its economic life, culture, folklore and sentiment as a nation are linked to the lake and that therefore much is at stake. Tanzania however points to the large number of Tanzanian fishermen and their ancestral burial places in the Lake.

Malawi and Tanzania both have a common interest in the form of a massive reservoir of the most valuable natural resource – fresh water. There is talk also of hydrocarbon deposits but at the very least, the lake is filled with fish.

A longer version of this article appeared first in ‘The Conversation’ by Gbenga Oduntan, Associate Professor in International Commercial Law at the University of Kent, UK – Editor.

Zambia and Kenya
When, in mid-August, Zambia agreed to supply Kenya with 100,000 tons of maize, to relieve its serious shortages, plans were made to supply it by road. But Tanzania said no. It could not agree to these large loads passing over Tanzanian roads. However, before the dispute could become more serious, it was agreed between Zambia and Tanzania to provide a special lane on their TAZARA railway line. These commodities were to be shipped by rail to Dar es Salaam and then on to Mombasa by sea. Zambia also agreed to cut the time spent in the issuing of permits to 24 hours rather than the normal seven days. Zambia and Kenya also agreed reduce the trade turn-around time.

Congo
President Joseph Kabila of the Democratic Republic of Congo paid a three-day state visit to Tanzania in September with the emphasis on improving trade links with Tanzania. The two governments signed a Memorandum of Understanding to conduct joint oil exploration on Lake Tanganyika. The leaders agreed that they would fast-track the construction of the standard gauge railway linking Congo with the Dar es Salaam port. Tanzania said it would allocate dedicated inland container terminals at Ruvu for cargo destined to go to Congo.

President Magufuli said that the two countries had cemented their trade, security and economic ties. President Kabila said that it was the first time since he became president that he had visited Tanzania to discuss trade. All his previous visits had concentrated on security. President Magufuli said that traffic through the Dar port was growing at the rate of 10.6% annually and that trade volumes between the two countries had increased from TSh 23 million in 2009 to TSh 396 million in 2016.

Some observers questioned the timing of this state visit as President Kabila was originally persuaded to step down as president in December 2016 at the end of his constitutionally mandated two-term limit in a deal mediated by the Catholic Church. There was a clear commitment to hold elections by the end of 2017 and that President Kabila would not be a candidate or try to amend the constitution. But these commitments seem to have been largely ignored and it is not known what the future holds.

Mauritius
Tanzania and Mauritius have committed themselves to promoting themselves jointly as twin tourist destinations. Mauritius national carrier Air Mauritius launched flights to Tanzania two years ago. The two countries have also signed special contracts with three consulting agencies from Europe and America to develop a marketing strategy for Germany, the USA and UK designed to penetrate world tourist markets. Mauritius recorded 2 million tourist arrivals in 2016 while Tanzania received 1.1 million. Tanzania is also targeting European travel markets, plus China, Russia, Turkey, Brazil and the Gulf states and promises more aggressive tourism marketing in the future.

‘Feza schools’ and Turkey
After the violent failed coup d’etat aimed at removing Turkish President Erdogan in late 2016 a massive purge began against anyone suspected of having been involved. Tanzania, which has warm relations with Turkey, has been the subject of allegations of involvement by 10 Feza schools which have been established in Tanzania. Turkey has targeted businesses associated with a Muslim cleric involved with these schools and has accused them of funding terrorist activities. Turkey’s ambassador to Tanzania has called for deregistration of the 10 schools as well as other businesses alleged to be funding the opposition against the Turkish president. However, Tanzania’s Foreign Minister Augustine Mahiga has explained that the 10 schools in Tanzania, which are run under the Ishik Medical and Educational Foundation, like other businesses in the country, had been vetted before being registered to operate in the country.

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BUSINESS & THE ECONOMY

by Ben Taylor

National budget endorsed
Members of Parliament (MPs) overwhelmingly endorsed the 2017/18 national budget: of 355 votes cast, 260 voted to approve the budget and 95 voted against. All but two opposition legislators voted to oppose the budget.

Finance and Planning Minister Philip Mpango announced the abolition of Value Added Tax (VAT) on hunting fees, licences and permits in order promote business in the sector. He also relieved private schools of skills development levy and fire extinguishing fees, expressing the hope that school owners will reduce their fees and enable more Tanzanian children to access private education. Further, industrial investors will no longer have to pay for the Environmental Impact Assessment (EIA) fee, said the Minister.

“The property tax is charged on permanent structures in cities, municipalities, towns and townships…villages and mud houses will not be taxed,” he clarified, adding that houses for people aged over 60 years are also exempted.

During the debate, a proposed property tax of TSh 10,000 and TSh 50,000 per ordinary house and storied buildings, respectively, were decried, with legislators describing the taxing of rural mud-built and grass-thatched houses as unfair and unjustifiable. The Minister clarified that “the property tax is charged on permanent structures in cities, municipalities, towns and townships … mud houses and houses in villages will not be taxed.” He added that houses for people aged over 60 years are also exempted.

Dr Mpango also defended the replacement of the annual motor vehicle licence fee with a levy of TSh 40 per litre on fuel, saying the move will relieve motorists with the burden of fee, which is costly. He dismissed claims by many MPs that taxing fuel was burdening the poor for the benefit of motorists, mostly urban dwellers, saying the collected taxes will be used to finance development projects and social service provision for the benefit of all, rural dwellers inclusive.

Deputy Minister for Finance, Dr Ashatu Kijaji said the government was committed to fulfilling President John Magufuli’s campaign promise to disburse TSh 50m to each village, saying already the State has already allocated about TSh 120bn for the purpose.

“We remain committed to release this money but there are issues that must be tackled…we are currently working on firm systems to support the distribution of the money,” said Dr Kijaji.

The Minister of State in the President’s Office, Public Service Management and Good Governance, Angela Kairuki said she would permanently verify the authenticity of public servants to ensure that not a penny from government coffers will be paid without proper justification.

“Let me be referred to as minister of verification, if necessary,” said the Minister, declaring the introduction of performance contract system for all executives in the public sector.

The opposition camp in parliament took issue with the budget, saying it contained serious, unexplained discrepancies and that it was crafted on the basis of an ambitious but unrealistic revenue assumptions. The Shadow Finance and Planning Minister, Ms Halima Mdee, is unable to attend sessions in parliament until February 2018 following a ban issued by the speaker. Her response to the budget was therefore issued to journalists.

Miss Mdee said the presented budget seems to be bent on killing the Decentralisation by Devolution (D by D) plan which seeks devolve powers from the central to the local government authorities. D by D started out of the admission that the central government had failed to do everything. Unfortunately, the central government is now grabbing the powers of collecting property tax and city service levy away from local government authorities,” said Ms Mdee.

Earlier, when tabling the budget, Mr Mpango acknowledged the concern of the increasing frequency of businesses closure in Kariakoo, Dar es Salaam and in other cities. He said figures from the tax authority, TRA, showed that from July 2016 to March 2017, a total of 7,277 businesses were shut down. “This trend is discouraging since residents lose jobs and incomes and the government loses tax revenue, while the economy slows down,” he said.

He told parliament that factors contributing to business shutdown include stiff business competition, weak business management, increasing business operating costs attributed to transportation, taxes and levies; and non-compliance to business rules and principles. He also reminded the house that it is worth noting that business owners have become aware of the need to report to TRA as soon as they cease their business operations in order to avoid accumulation of tax liabilities, and that a much larger of new businesses were registered during the same period.

He compared this situation to that of China since the 1980’s, quoting from a book on the subject: “Businesses at the time were like ships, each raised up and carried along by the sheer momentum of the wave. Some, however, soon capsized and were swallowed up, while most drifted along, going with the flow. Others crashed against barriers in the sea or got stranded on deserted islands. Only a few rose atop the crest of the wave and survived, eventually sailed towards new lands.”

The Minister refuted accusations that the government was anti-business, reassuring business leaders that the fifth phase government recognised business as the engine of the economy and recognised the contribution of business to national development. He pointed to the government’s efforts to maintain economic stability, peace and security, reduce regulation and to development national infrastructure as evidence of the government’s pro-business credentials. He also reminded TRA officials to act fairly and in accordance with the law when dealing with tax payers. (The Citizen, Daily News)

Case against Manji heard at Muhimbili National Hospital
Kisutu Magistrate’s Court in Dar es Salaam briefly relocated to Muhimbili National Hospital (MNH) in July, where prominent businessman Yusuph Manji and three others were charged with seven counts relating to military uniform fabrics worth over TSh 200m. Other charges relate to illegal possession of government stamps, which are three rubber stamps of the TPDF bearing different addresses and two motor vehicle plate numbers of government offices suspected to have been unlawfully acquired. Manji is charged alongside three officials with Quality Group, the firm he heads.

Manji has for several months been a patient of the Jakaya Kikwete Cardiac Institute under police supervision after initially being arrested on immigration-related charges.

It is alleged that on June 30, the accused persons were found by a police officer in possession the fabric, stamps and number-plates without lawful authority. The prosecution alleges that this was prejudicial to the safety or interests of the United Republic of Tanzania.
Manji and his co-accused were not required to enter a plea at this stage.
(Daily News, The Citizen)

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AGRICULTURE

by David Brewin

The armyworm returns in another form

Fall armyworm

The much-feared armyworm caterpillars have returned in another form to parts of Africa including Tanzania. These armyworms are called “fall armyworm”, and they began emerging in early 2017 throughout East Africa and beyond. During recent months, the governments of Kenya, Uganda and Tanzania have allocated more than $7.85 million for the purchase of specialised chemicals to fight them as they could wipe out large areas particularly of maize and sugarcane.

The fall armyworm is not easily noticeable in its early stages as it attacks from the heart of the maize or sugar plant. It burrows into the stalks of maize like a borer and once the worms turn into moths they can lay more than 2000 eggs in different places with a lifespan of 30 days spreading fast and in huge numbers.

The Permanent Secretary in the Tanzanian Ministry of Agriculture, Livestock and Fisheries Mathew Mtigumwe has been quoted in the press as saying that the government is aware of the presence of the new species and has put into action various initiatives to control the situation particularly in the Katavi, Mbeya and Songwe areas. Rungwe Region has been attacked from neighbouring Zambia.

The fall armyworm appears to be new in Africa and it attacks maize at all stages. Control is difficult because of the cost and scarcity of specialised pesticides as the crops are resistant to the conventional chemicals formerly used against armyworm.

Expansion of irrigation
Tanzania is said to be still well below achieving its target of 1 million hectares of irrigated land, as efforts to boost irrigation in Tanzania continue but the industry faces many problems. These include ongoing low productivity, rising food prices, and growing concerns that climate change will impact on Africa’s already unpredictable weather.

The total area of irrigated land in Tanzania is expected to double between 2004 and 2040 which promises big increases in food security. Crop yields are estimated to be 2 to 4 times higher on irrigated land than on non-irrigated land.

Tanzania may actually be much closer than expected to its national target of 1 million hectares of land irrigated, but the figures are difficult to confirm because official statistics often do not include irrigation schemes set up and run by individual small farmers. Further research is needed.

Cashew nut smuggling
Prime Minister Kassim Majaliwa has warned that traders and farmers in Lindi Region must stop selling cashew nuts to “racketeers”, and told them that they must use the official authorised marketing channels which will also provide better prices. Some traders have been buying the nuts at TSh 1,000 per kilo but the real price is expected to rise to TSh 3,500 this year.

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