The Chant of Savant

Wednesday 1 November 2017

Let’s not get ahead of ourselves on ‘historic’ Barrick deal

Recently, the government of Tanzania released the report of the outcomes of its negotiations with the Barrick Gold that started after government commendably decided to look into mining businesses in the country. It was after learning that Acacia Mining Company, a Barrick Gold affiliate, had evaded tax for about 19 years plus exporting concentrates without declaring the actual amount of minerals found in them. So, too, it was unearthed; Acacia was operating in Tanzania illegally among others. Therefore, such criminality led to the creation of two taskforces to look into the matter thereby unearthing a lot of rot which forced the government to, temporarily, suspend Acacia’s activities in Tanzania conditionally that it should negotiate with the government which it did through Barrick Gold.
            After over three months of negotiations, President John Magufuli hailed as a historical breakthrough. However, critics are a bit wary about this elusive breakthrough. The president told the nation that Barrick Gold, not Acacia, agreed to pay US$300 million as a sign of ‘goodwill’ or showing either sincerity or dependability which is a bit convoluted. Barrick spokesperson Andy Lloyd was recently quoted by the Minning.com as saying that “that is not a concession that is complying with the law.” The promise to cough US$300 million enthralled Magufuli who said he wanted the money quickly so that it could be used in the provisions of services.
Despite such palms, there are some unanswered questions with regarding Barrick deal. Critics think; it is too early for Tanzania to celebrate provided that the negotiations are ongoing. The major question is: What criteria were used to reach such an amount? Can the good will or trustworthiness be translated into money or through admission of the offence? For conflict resolutions scholar, this offer is cloudy and headachy so to speak. Trust in negotiations can be displayed through cooperation in problem-solving approach whereby the parties in conflict agree on some issues in principal but not through inducements as it seems to be in this case. Logically, inducements many help the offender to predict the behaviour of and the next move his or her opponent will make. For example, Barrick offered the money. Tanzania accepted it without qualms. This tells something. Success in negotiations, sometimes, is about timing, scheming, trust building and whatnots. Entering negotiations doesn’t necessarily the warrant trust and cooperation.
Is the offered amount aimed at inducing Tanzania? What did Tanzania offer in reciprocating to such newly-found friendship and generosity that forced Magufuli to lovey-dovey refer to Barrick as brethren but not pilfers as it once was perceived after unearthing the scam? Such questions are valid provided that the two taskforces one headed by Professors Abdulkarim Mruma and the other, professor Nehemiah Osoro, unearthed a lot of rots and wheels and deals. If the findings of the taskforces–that Acacia rubbished–are to go by, concluded that Tanzania lost between Sh68.59 trillion and Sh108.46 trillion from unpaid mining taxes due to under declaration of exports of metallic mineral concentrates by Acacia Mining PLC in the 19 years (The Citizen, June13, 2017). From such an amount, the government was supposed to receive at least US$ 60 billion in revenues (The East African, 12 June, 2017). When one looks at such humungous figures and compare it with US$300 million, chances are that the so-called big deal might turn out to be a bad deal or a no deal. Instead of buying goodwill, I methinks; the government should disclose as to how much money Acacia is going to pay but not to offer in goodwill or whatever.
 Why Acacia was not directly involved in the negotiations while, in law, it is the one that is duty-bound to pay whatever is agreed upon? Legally, will Acacia accept whatever is agreed upon? Again, methinks; the issue was not about Barrick or Acacia showing good will, trust, commitment or whatever it is called. The issue was simply for the two parties to reach the agreement on what is owed and how it is going to be paid.
Due to the jubilations and controversies, of course, stemming from the outcomes of the negotiations, one may ask: What was; and still is the driving force for Tanzania to enter into negotiations with Barrick? Was it its quest for recovering the loss Acacia incurred or just to get whatever amount of money or njaa regardless if it is worth the crime that Acacia committed?
Despite good news such as the sharing of the profits by 50-50, employing locals, establishing headquarters, banking in Tanzania and many more goodies as enumerated by Minister for Constitution and Justice prof Paramagamba Kabudi, much remains to be seen as to if really Tanzania will benefit from its negotiations with Barrick but not Acacia which recently said it is unable to pay the agreed good will or trust building money. Whether the said negotiations will bear fruits or not, it is too early to rejoice or jeer.
SOURCE: Citizen Wed., today

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