I wonder which NGO is behind this?

It’s going from bad to worse for Acacia Mining.

The London-listed gold company has just been told it owes $190bn in unpaid taxes and penalties by the government of Tanzania.

The country’s President John Magufuli has accused the company of deliberately understating its exports to avoid paying royalties and other taxes.

Acacia has strongly denied the charges, saying that it has fully declared all revenues from its mines in the country.

Long story short. Acacia runs gold mines in Tanzania. Govt alleges – and a government committee has confirmed via analysis – that Acacia is grossly underestimating gold content of semi-processed ore it exports. Thus a tax bill for 2 centuries worth of gross revenue that Acacia reports.

This is a shakedown by Tanzanian govt. There is simply no way at all that there is the gold content being claimed. Quite apart from anything else, where the hell is the money going? For it’s most certainly not turning up in the company accounts. They’re also flat out wrong on their valuation method. Ore doesn’t pay out for what is in the ore, only for what is commercially extractable. So things like the level of Ytterbium are an irrelevance.

The thing is, such allegations won’t come from nowhere. My guess is that there’s an agitator, some NGO, behind this. Who, I have no idea.

Worth noting though that the basic claim about gross misinvoicing started with Alex Cobham, he’s now at TJN. He claimed some massive fraud by Glencore over copper exports from Zambia. He was wrong, grossly so. He was comparing the copper price of thousands of tonnes leaving Zambia with the price of the odd 10 kg sample leaving Switzerland. Entirely unaware that recorded customs prices include the cost of transport. And, yes, the cost of transport per kg for a shipload of copper is different from the cost per kg of transport of a sample by DHL.

This was followed by a UN look at South Africa’s mineral exports, entirely fucked up again by the committee. And now this in Tanzania.

Wouldn’t it be interesting to know which NGO or adviser is behind this clusterfuck?

20 thoughts on “I wonder which NGO is behind this?”

  1. Nice to see business as usual in these country. I’m surprised the government haven’t go for the next step of nationalizing the mines.

  2. Either the Tanzanien government is really dumb enough to think they are going to get the 190 billion or this is the opening of a process of nationalizing the mines at zero cost. Acacia simply cannot pay that amount of money. It is a ridiculous figure. However, failure to pay would allow the government to seize all the assets of Acacia in the country.

    Of course this would mean that future inward investment in Tanzania would drop.

  3. This is the point that the Foreign Office crew should start earning their fucking wages by phoning up these thieving Tanzanian Twats just to point out how many very nasty things happen to people in the third world every day.

    And the same goes triple for NGOs.

  4. I’d be looking at who’s behind the NGOs behind this. If western resource exploitation companies are driven out of the third world, which up and coming global power(s) will be ready to step in.

  5. My bet is the new TZ government have thought this up all on their own. Acacia have made a few offers ( increased rents from 4% to 6%, and 3 years expected CT up front ) but my guess is it won’t be accepted. And the countries around TZ with adults in charge will worry about their FDI and have a word with Magufuli if they can. But the TZ president cannot back down or he will lose face, and that is a big deal with would-be nationalist despots.
    They need a Clegg in charge- someone who doesn’t mind losing face.

  6. I’m surprised none of the businesses accused has sued an NGO yet over this. Particularly Glencore; I’d have thought they’d be up for it.

  7. Correct, salamander. TZ will pay a very high price for seizing the assets without paying for them.

  8. Bring on ocean floor mining. Then we can just sit back and watch the third world countries weep and wail, cursing the sky, wondering were their tax revenue has disappeared.

  9. Not suggesting it is happening, but if It were, the last place I would expect to see the proceeds from the smuggled ore would be in the company accounts.

  10. @BiG
    If it’s not in the company accounts, then it’s not Acacia doing it. Companies are their accounts. That’s not to say there’s not some individuals doing it. In which case they’re ripping off Acacia as well as TZ

  11. Bloke in North Dorset

    “Of course this would mean that future inward investment in Tanzania would drop.”

    No, no, no. Second and higher order affects are nothing but new-liberal sophistry.

  12. “No, no, no. Second and higher order affects are nothing but new-liberal sophistry.”

    Neoliberal, not new liberal

  13. Pingback: Tanzania's Shakedown Of Acacia Mining Might Work – In The Short Term | The Continental Telegraph

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