Tanzania remains “only” an EITI candidate country
On August 16th , 2011 the Board of the Extractive Industries Transparency Initiatives (EITI) - a global standard for transparency and accountability in the oil, gas and mining sectors - decided to postpone the decision on a full EITI membership to Tanzania. The Board congratulated Tanzania for the progress made in implementing the EITI rules but it found that Tanzania did not yet meet all the EITI standards. The decision was made after reviewing the first report made by the Tanzania Extractive Industries Transparency Initiative (TEITI).
The report which was presented on February 11th 2011 covers payments received from nine mining as well as three gas companies. It reconciled these payments with revenues collected by the Tanzania Revenue Authority (TRA), the Ministry of Energy and Minerals (MEM), and the National Social Security Fund (NSSF).
The report discloses by 46.5 billion TSh (about 21.3 million Euro) higher payments from the companies as revenue on the government side. About 18.6 billion TSh (about 8.6 million Euro) fall upon fuel levy, whereas here the discrepancy between payments made by the companies and revenue received by the authorities is mostly due to incorrect documentation. In fact, the payments were reimbursed later. However, the companies did not mark these payments as refunds in their own audit reports. Further discrepancies of about 22.6 billion TSh (10.5 million Euro) relate to royalty payments in the mining sector and are justified by wrong tax bases, confusion between fiscal years, currencies (TSh/USD) or revenues as well as administrative difficulties such as lack of technical equipment.
The German Federal Ministry for Economic Cooperation and Development (BMZ) is making important contributions to this initiative to improve transparency in the extractive industry by financially supporting the international financial fund (Multi Donor Trust Fund) as well as the international EITI Secretariat in Oslo.
The board decided to renew Tanzania’s’ candidacy for 18 months, by the end of which it must have completed a validation that demonstrates compliance with the EITI rules.