From loss making to profit generating

Venance Mwasse is Director, Minerals Audit and Trade at the Minerals Commission, Tanzania and also Chairman of the Board of Directors, Stamigold Company Limited. Venance has facilitated a number of Australian funded workshops and projects related to mining tax regimes and transfer pricing and was also involved in the publication “How To Improve Mining Tax Administration and Collection Frameworks” a World Bank and Centre for Exploration Targeting publication. He was also a workshop participant in the Mining Revenue Management, Policy and Regulations short course in 2015.

Tanzania is endowed with vast quantities of resources whose extraction has been central to the country’s economic growth. Leading minerals include gold, iron ore, nickel, copper, cobalt, silver, diamond, tanzanite, ruby, garnet, limestone, soda ash, gypsum, salt, phosphate, coal, uranium, gravel, graphite, sand and dimension stones.

In 2017, Tanzania passed sweeping new laws for its extractives sector with the objective of getting a larger share of the benefits from its mineral and gas deposits. The President also ordered a special audit of mining companies to determine if they pay their fair share of taxes.

Venance and his team were tasked with curtailing mineral smuggling; developing strategies for increasing revenue collections from the mining sector; and formalizing artisanal and small scale miners (ASM). To address these issues, he has been involved in establishing local mineral markets for artisanal miners, brokers and mineral dealers; strengthening controls and auditing to enhance compliance of reported declarations and payments of government dues; engaging with local authorities and the Federation of Miners Association of Tanzania (FEMATA), for jointly identifying, tracing and monitoring mineral operations in each locality.

Through his involvement in Australian programs…

“I managed to make a good professional network for regular consultation and sharing of new knowledge and challenges for better administration of the sector. Additionally the three months course covered policy making, administration, project financing and accounting, contract negotiation skills and also mining taxation and auditing. All these blended together create a very crucial foundation and practical tools for understanding and effective administration of the sector in general.”

These tools have been essential in achieving a number of successful outcomes. These include:

  • establishing and operating 27 minerals local markets in each Tanzanian region. As a result revenue collection has doubled and smuggling has substantially decreased.
  • intensive audit and critical analysis helped to identify harmful practices by mining companies which reduced taxable income through Abusive Hedge Arrangements and Non-Ring Fencing practices. After agreed adjustments with companies, this has generated over $30 million additional corporate tax revenue for the government.
  • in 2017, he was appointed Mine General Manager for Stamigold Mine -a wholly owned government gold mine. He managed to turn it around from a loss making to profit generating venture. Under his leadership, he was able to implement cost control measures, enhance production, facilitate good financial management and restore staff morale. As a result of these achievements, he was awarded a Certificate of Appreciation and was appointed Director in the Mining Commission and Chairman of the Board of Directors of Stamigold Company Limited.

 Venance says that

“Positive thinking, innovative approach, taking calculated risk after critical analysis and making data based decision which add or create public value have been the secrets for my success. Also participatory and transparent approach in sharing outcomes and teamwork building. Recognition and appreciation of colleagues/subordinates efforts which in turns st used to serve as strong rewarding mechanism and finally enhance morale to work.  With huge exposure and practical sector knowledge it gave me confidence to build a case and be trusted by my superiors-decision makers”.

His goal is to enable growth and maximum benefits to the Nation through proper and inclusive administration of the mining sector and for Stamigold to be the national flagship on government participation in the mining sector for the ultimate benefits of Tanzanians.

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