Despite loss Barrick sticks with Tanzania

DAR ES SALAAM, African Barrick Gold (ABG) suffered a loss of $110 million (about Tsh179 billion) last year. 

This is despite creating  65,000 jobs in Tanzania with an investment of over $2 billion (over Tsh3trillion) in Tanzania economy.  ABG is currently the largest gold producer in Tanzania with three operational gold mines that includes Bulyanhulu, North Mara and Buzwagi and contributed over $980 million (Tsh1.5 trillion) to the Tanzania economy in 2013 that accounted for 3% of the country’s GDP.

The ABG Chief Executive Officer Brad Gordon told East African Business Week in Dar es Salaam recently the loss was due to fluctuations of gold prices in the world market while at the same time contributing around $223 million (Tsh358 billion) in direct taxes.

However, Gordon said ABG was still stable with a cash position of $289 million (Tsh464billion) as of September 2013 and the employment opportunities it offers and all its undertakings in the mining sectors gives it a position of being the largest private importer in the country.

He said that around $514 million (Tsh826 billion) worth of goods and services were locally sourced in 2013 which represented 32% of the total spent procurement chain.

“For a period of 13 years we have been in operational in the country, we have managed to become one of the major employers,” Gordon said. He said currently 93% of all the workers at ABG were Tanzanian. 

He said ABG expects to start its production at the Buzwagi mine in five years  and position itself as the most efficient miner in Africa after being stalled for a period.

ABG, the largest foreign direct investor in Tanzania, is also planning to inject an additional $445 million (Tsh715billion) this year compared to $700 million (Tsh1.1 billion) additional investment it made in 2012.

Gordon said ABG is implementing its investments in making sure that it comes closer to the community by investing $14 million (Tsh22 million) per annum in Maendeleo Fund in the 50 projects of clean water, infrastructure, education and others.

The mining industry contributes hugely to the country’s GDP through employment, supplier contracts, investments, payment of government taxes and multiplier effects from business linkages to other sectors. In 2012 the sector recorded an impressive growth rate of 7.8% in 2012, up from just 2.2% in 2011.